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In a Crop Market with a Price Support Above the Equilibrium

Question 92

Multiple Choice

In a crop market with a price support above the equilibrium price,the total amount of the subsidy paid to farmers is equal to the


A) quantity of the surplus crop multiplied by the support price.
B) quantity of the crop produced multiplied by the support price.
C) quantity of the crop purchased by domestic users multiplied by the support price.
D) quantity of the surplus crop multiplied by the equilibrium price.
E) quantity of the crop purchased by domestic users multiplied by the equilibrium price.

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