Suppose the Demand for Eggs Is Inelastic and That the Market-Clearing

question 41

Multiple Choice

Suppose the demand for eggs is inelastic and that the market-clearing price is $1.50 per dozen.Now suppose the government imposes a minimum price of $2.00 per dozen.Why might the government implement such a policy?

• A)to make consumers better off
• B)to increase the incomes of egg farmers
• C)to increase excess demand in the egg market
• D)to reduce excess supply in the egg market
• E)to decrease tax revenues from egg farmers

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Definitions:

Role Ambiguity

A situation in which the expectations associated with a role are unclear, leading to confusion and possibly stress.

Institutionalism

Institutionalism refers to an approach in social science that emphasizes the role of institutions in shaping social behavior, outcomes, and processes.

Psychological Apathy

A state of indifference where an individual shows lack of interest, enthusiasm, or concern towards emotional, social, or physical life.

Daily Life

The routine or regular activities and experiences that make up an individual's everyday existence.