When the Federal Government Installs a Price Support Program That

Multiple Choice

When the federal government installs a price support program that requires the government to purchase all of a good not bought in the private economy at the support price, changes in producer surplus:

A) are negative.
B) are positive, but more than offset by the cost to consumers and the government.
C) are positive, and not offset by the cost to consumers and the government.
D) and consumer surplus are both positive.