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Some Countries Use Price Floors for Their Domestic Farmers to Guarantee

Question 127

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Some countries use price floors for their domestic farmers to guarantee them a high return on their production.Suppose there is a price floor on wool that is binding.What will be the effect on the wool market? Identify who benefits from this policy and who bears the cost.Are there instances of this occurring in Australia's history?

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Wool prices will be higher and this will...

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