Under the target price program,
A) the government ends up buying the surplus product that results.
B) taxpayers pay the difference between the price consumers pay and the target price.
C) deficiency payments are made to both rich and poor farmers.
D) the surplus that results is sometimes dumped or otherwise wasted.
E) b and c
E
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Although the efficient quantity to produce of any good is located where marginal social benefit and marginal social cost are equal, there will usually be other quantities where the sum of consumer and producer surplus are greater
Indicate whether the statement is true or false
There is only one efficient allocation of resources in an economy at one point in time.
Answer the following statement true (T) or false (F)
Product differentiation in monopolistically competitive markets implies that: a. firms make economic profits in the long run
b. firms will produce at the minimum of the average total cost curve in the long run. c. individual firms face downward-sloping demand curves. d. firms are certain to earn economic profits in the short run.
Suppose that Emily opens a restaurant. She receives a loan from a bank for $200,000 . She withdraws $100,000 from her personal savings account. The interest rate on the loan is 6%, and the interest rate on her savings account is 2%. Emily's total opportunity cost of capital is
a. $2,000. b. $4,000. c. $12,000. d. $14,000.