-The above figure shows supply and demand curves for milk.In an effort to help farmers,the government passes a law that establishes a $3 per gallon price support.To maintain the price support,government expenditures must equal
A) k + i.
B) f + g + h + i + j.
C) f + g + h + i + j + k.
D) f + g + h + i + j + k + e.

Question

-The above figure shows supply and demand curves for milk.In an effort to help farmers,the government passes a law that establishes a $3 per gallon price support.To maintain the price support,government expenditures must equal
A) k + i. 
B) f + g + h + i + j. 
C) f + g + h + i + j + k. 
D) f + g + h + i + j + k + e.

Quizplus · Accepted Answer

To maintain the price support at $3 per gallon, the government must buy the surplus milk that is not purchased by consumers at the support price. This surplus is represented by the quantities f + g + h + i + j + k.

-The Above Figure Shows Supply and Demand Curves for Milk