Which one of the following is an example of government failure associated with the introduction of a guaranteed minimum price floor for agricultural crops set above the market equilibrium?
Contraction in agricultural supply
Emergence of a persistent shortage of crops
Distortion of market signals leading to a persistent surplus and high taxpayer costs for storage or disposal
Extension in consumer demand
9 exam-style questions on Edexcel A A Level Economics 1.4.2 Government failure. Each one has a worked solution and a mark scheme showing where the marks go.