The following graph shows the market for milk. The market price of milk without government intervention is____________per gallon. Consider the legislation that doesn't allow the price of milk to be below $8 per gallon and stimulates that the government by any surplus milk produced at that price. In order to raise the price of $8 per gallon, the government would need to buy______million gallons of milk, which would cost the government__________million. Suppose there are only a few dairy Farmers who would benefit from this legislation and millions of consumers who would suffer through higher prices. In this case, legislation imposing price supports at $8 per gallon would mean which of the following? The legislation will probably pass because it's benefits are concentrated while it's cost or widespread. The legislation should pass because it's economical efficient, but it probably won't because consumers don't understand enough about economics. The legislation may or may not pass since the benefits and costs of the legislation are concentrated among severely sized groups. The legislation will be easily defeated because the increased price of milk would hurt millions of consumers, who would not re-elect their representatives.
The following graph shows the market for milk.
The market
Consider the legislation that doesn't allow the price of milk to be below $8 per gallon and stimulates that the government by any surplus milk produced at that price. In order to raise the price of $8 per gallon, the government would need to buy______million gallons of milk, which would cost the government__________million.
Suppose there are only a few dairy Farmers who would benefit from this legislation and millions of consumers who would suffer through higher prices. In this case, legislation imposing price supports at $8 per gallon would mean which of the following?
The legislation will probably pass because it's benefits are concentrated while it's cost or widespread.
The legislation should pass because it's economical efficient, but it probably won't because consumers don't understand enough about economics.
The legislation may or may not pass since the benefits and costs of the legislation are concentrated among severely sized groups.
The legislation will be easily defeated because the increased price of milk would hurt millions of consumers, who would not re-elect their representatives.
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