When the Government Implements a Price Support Program

question 19

Multiple Choice

When the government implements a price support program:

• A) it may end up buying a lot of the good, for which it has little or no use.
• B) the goal is to increase the market price of the good.
• C) the deadweight loss created can be larger than that created by a price floor.
• D) All of these occur as a result of a price support program.

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Definitions:

Nearest 0.01%

Rounding a number or percentage to the closest hundredth of a percent for precision.

Emotions

Complex psychological states involving physiological arousal, feelings, cognitive processes, and behavioral reactions.

Feedback System

A process or mechanism by which information about the outcomes of actions is returned to the originator, enabling adjustment or improvement of future actions.

Anxiety

A feeling of worry, nervousness, or unease about something with an uncertain outcome.