Author Question: A support price set above the equilibrium price ______. A. creates a shortage, increases farmers' ... (Read 83 times)

jilianpiloj · **on:** Jun 29, 2018

A support price set above the equilibrium price ______.

A. creates a shortage, increases farmers' total revenue, and is efficient
B. creates a surplus, which the government buys and dumps on the rest of the world to keep the U.S. market price equal to the price support
C. is inefficient because farmers' marginal cost exceeds U.S consumers' marginal benefit
D. is efficient because farmers' marginal cost equals U.S. consumers' marginal benefit

Question 2

What two things does the amount of property income a household earns depend upon?

What will be an ideal response?

ApricotDream · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

B Price supports set above the equilibrium price require the government to purchase the surplus to maintain the price.

Answer to Question 2

The amount of property income a household earns depends upon how much property it owns and what kinds of assets it holds.