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1.4 Government intervention

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Question 10

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

1.4 Government intervention Questions

  1. A Level
  2. /Economics
  3. /1.4 Government intervention