An Agricultural Price Support

question 95

Multiple Choice

An agricultural price support

• A)will create a surplus in the relevant market,assuming the price support is above equilibrium price.
• B)will create a shortage in the relevant market,assuming the price support is above equilibrium price.
• C)is an example of a price floor.
• D)will lead to greater total revenue for farmers if demand (for the product)farmers sell is inelastic between the equilibrium price and the price support (and assuming the price support is above equilibrium price).
• E)a,c,and d

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Definitions:

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A form of government with a monarch at the head, where the position is often hereditary.

Democracy

Democracy is a form of government in which power is vested in the people, who rule either directly or through freely elected representatives, allowing for the protection of rights and participation in decision-making processes.

Autocracy

A system of government where absolute power is concentrated in the hands of a single person or a dominant authority.

Socialist

Pertaining to socialism, a political and economic theory advocating for the collective or governmental ownership and administration of the means of production and distribution of goods.