Price floors in agriculture lead to
A) efficient farming techniques being employed.
B) surpluses of supported farm products.
C) more competition in farming.
D) the most efficient market solution.

Question

Quizplus · Accepted Answer

Price floors in agriculture lead to surpluses of supported farm products because they set a minimum price that is above the equilibrium price, which encourages farmers to produce more than the market demands. This can result in excess supply that may go unsold or require government intervention to remove from the market. Price floors do not necessarily lead to efficient farming techniques, more competition, or the most efficient market solution.

Price Floors in Agriculture Lead to