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Economics (AS & A Level) · May / June 2024 · Paper 11 · Question 13

9708Methods and effects of government intervention in markets

A government wishes to raise the incomes of farmers without raising the price of food to consumers. Which policy should it use?

  1. Aa maximum price below the market price for food
  2. Ba minimum price below the market price for food
  3. Ca payment of a subsidy to farmers to produce food
  4. Da release of government food stocks onto the market

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Correct answer: C. a payment of a subsidy to farmers to produce food

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