Question p65 - The producers may have thought that the...

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Ryan Wisneski ECO2023 Due: January 16, 2009 Question #8 p. 65 By setting a minimum price of $2.00 per apple the market would apples would begin to see a market surplus. This happens because the apple producers are willing to supply more apples at a higher price but with the increase in price the consumer wouldn’t be willing to spend as much thus lowering the demand.
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Unformatted text preview: The producers may have thought that the prices at which the apples were selling for was not high enough, making the opportunity cost must higher to produce them. The producers may have thought that the price floor would be beneficial to them but did not realize the negative ramifications that were brought along with it....
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