# D suppose the government buys up all of the farmers

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d. Suppose the government buys up all of the farmers' output at the floor price and then sells the output to consumers at whatever price it can get. Under this scheme, what is the price at which the government will be able to sell off all of the output it had purchased from farmers? What is the revenue received from the government's sale? e. In this problem we have considered two government schemes: (1) a price floor is established and the government purchases any excess output and (2) the government buys all the farmers' output at the floor price and resells at whatever price it can get. Which scheme will taxpayers prefer?
f. Consider again the two schemes. Which scheme will the farmers prefer? g. Consider again the two schemes. Which scheme will corn buyers prefer Table 1-3 Price per kilo (Dollars) Quantity demanded (kilos) Quantity supplied (kilos) \$2 40,000
0 4 34,000 4,000 6 28,000 8,000 8 24,000
16,000 10 20,000 20,000 12 18,000 28,000 14 12,000 36,000
16 6,000 40,000 Table 1-3 Price per kilo (Dollars) Quantity demanded (kilos) Quantity supplied (kilos)
\$2 40,000 0 4 34,000 4,000 6 28,000 8,000
8 24,000 16,000 10 20,000 20,000 12 18,000 28,000 14
12,000 36,000 16 6,000 40,000

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• Fall '19
• Federal government of the United States, agricultural price floor

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