The table shows the demand and supply schedules for hay before and during a major drought. During the drought, suppose the government gave all farmers an equal quantity of hay. Resale of hay is not permitted. W A. maximized; rises OB. maximized; falls OC. maximized; does not change OD. less than the maximum possible; falls O E. less than the maximum possible; rises Suppose the government buys more than the equilibrium quantity of hay and pays the supply price for this quantity. Total surplus purchased, and the price of a bale @ # 73 compared to the total surplus when the equilibrium quantity is compared to the equilibrium price. OA. increases; rises OB. decreases; rises OC. decreases; falls OD. increases; falls OE. remains unchanged; remains unchanged e ... с $ 4 7 % 5 O t Oll ^ 6 y & 07 7 Price (dollars per before drought bale) (thou 0 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 U * Quantity demanded 8 0 40 35 30 25 20 15 10 5 0 6

The table shows the demand and supply schedules for hay before and during a major drought. During the drought, suppose the government gave all farmers an equal quantity of hay. Resale of hay is not permitted. W A. maximized; rises OB. maximized; falls OC. maximized; does not change OD. less than the maximum possible; falls O E. less than the maximum possible; rises Suppose the government buys more than the equilibrium quantity of hay and pays the supply price for this quantity. Total surplus purchased, and the price of a bale @ # 73 compared to the total surplus when the equilibrium quantity is compared to the equilibrium price. OA. increases; rises OB. decreases; rises OC. decreases; falls OD. increases; falls OE. remains unchanged; remains unchanged e ... с $ 4 7 % 5 O t Oll ^ 6 y & 07 7 Price (dollars per before drought bale) (thou 0 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 U * Quantity demanded 8 0 40 35 30 25 20 15 10 5 0 6

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter7: Consumers, Producers, And The Efficiency Of Markets

Section: Chapter Questions

Problem 6PA

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