Ed has 100 tons of manure. The lowest price at which he is willing to sell it is $10 per ton. Fred wants to buy 100 tons of manure. The most he is willing to pay is $8 per ton. The federal government offers to subsidize manure sales at a rate of $1 per ton. If Ed and Fred are the only people who deal in manure, then the dead- weight loss caused by the subsidy is a. $100. b. $50. c. $0. d. $200. e. none of the above. ANS: C DIF: 1

Ed has 100 tons of manure. The lowest price at which he is willing to sell it is $10 per ton. Fred wants to buy 100 tons of manure. The most he is willing to pay is $8 per ton. The federal government offers to subsidize manure sales at a rate of $1 per ton. If Ed and Fred are the only people who deal in manure, then the dead- weight loss caused by the subsidy is a. $100. b. $50. c. $0. d. $200. e. none of the above. ANS: C DIF: 1

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter19: Using Economics To Understand The World Around You

Section: Chapter Questions

Problem 9E: The United States government subsidizes many so-called green companies. For instance, it has given...

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