Of the Following Groups, Which Benefits Most from a Government

question 204

Multiple Choice

Of the following groups, which benefits most from a government price support program that establishes a floor price for an agricultural product that is higher than the product's market clearing price?

• A) consumers, who purchase more units of the product than they did before the price support program was implemented
• B) taxpayers, who no longer must provide funds to purchase surplus units of the product once the price support program is in place
• C) producers, who earn a higher price on the sale of each unit and also sell more units, thereby unambiguously earning higher revenues
• D) the government, which receives subsidy payments from producers that are required to sell more of the product at a higher price under the government's program

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Definitions:

Implicitly

In a way that is not directly expressed but is understood or implied.

Explicitly

Stated clearly and in detail, leaving no room for confusion or ambiguity.

Venture Capitalists

Investors who provide capital to start-ups and early-stage companies with potential for high growth, typically in exchange for equity.

Startup

An entrepreneurial venture typically in the early stages of operations, often innovation-driven and aiming to meet a marketplace need by developing a viable business model around a product, service, process, or platform.