The government occasionally uses price supports to aid farmers. A price support works like this: the government promises to buy all the produce the farmer cannot sell in the market at some pre-set price. For example, if the price of lettuce was $.30 a head in the market, the government might offer a price support of $0.50 a head. Show and explain that the effect of a price support is the same as a price floor. You should use graphs to aid your explanation.

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anonymous · Answer

|dw:1414904434176:dw| not sure if this is somewhat the right start? @jim_thompson5910 :/

anonymous · Answer

graph wise at least?

jim_thompson5910 · Answer

why is the price support sloping downhill?

anonymous · Answer

oh is it supposed to go upwards? because of more purchases? :/

jim_thompson5910 · Answer

notice how it says "Show and explain that the effect of a price support is the same as a price floor. "

anonymous · Answer

ohh so it should be like this? |dw:1414904724649:dw|