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The Market for Columbian Coffee Beans Is Given in the Diagram

Question 19

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The market for Columbian coffee beans is given in the diagram below.The market is currently in equilibrium with a price of P0 and a quantity exchanged of Q0.Suppose that the Columbian government takes over the production and distribution of all coffee beans grown in Columbia.In an effort to increase revenue from the sales of coffee beans,the government decides to raise the price above P0.Describe why it would take more effort for the government to raise the price to P2 than it would for it raise the price to P1.
The market for Columbian coffee beans is given in the diagram below.The market is currently in equilibrium with a price of P<sub>0</sub> and a quantity exchanged of Q<sub>0</sub>.Suppose that the Columbian government takes over the production and distribution of all coffee beans grown in Columbia.In an effort to increase revenue from the sales of coffee beans,the government decides to raise the price above P<sub>0</sub>.Describe why it would take more effort for the government to raise the price to P<sub>2</sub> than it would for it raise the price to P<sub>1</sub>.

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