Recall the Application about the policies used by the European Union to support the agricultural sectors of is member countries to answer the following question(s).
-According to this Application, in recent years the European Union has reformed its agriculture policies by reducing or eliminating minimum prices. Ceteris paribus, these policy reforms would ________ excess supply by ________ prices.

Question

Quizplus · Accepted Answer

By reducing or eliminating minimum prices, the European Union is likely to reduce excess supply, as farmers will no longer be incentivized to produce as much as possible. This reduction in supply should lead to lower prices, as demand remains the same. Therefore, the correct answer is B, "reduce; lowering".

Recall the Application About the Policies Used by the European