Recall the Application about federal quality standards in the market for kiwifruit to answer the following question(s).
-Recall the Application. The federal government marketing order that helped reduce asymmetric information about kiwifruit led to
A) a decrease in the spread between the price of New Zealand and U.S. kiwifruit.
B) lower quality kiwifruit sales.
C) more kiwifruit imports.
D) lower kiwifruit sales.

Question

Quizplus · Accepted Answer

The federal government marketing order helped reduce the asymmetric information about kiwifruit, which increased the confidence of consumers in the quality of U.S. kiwifruit. This led to a decrease in the spread between the price of New Zealand and U.S. kiwifruit, as consumers were willing to pay more for the higher quality U.S. kiwifruit. Therefore, option A is correct. Option B, C, and D are incorrect as they do not align with the positive effects of the marketing order on the kiwifruit market.

Recall the Application About Federal Quality Standards in the Market