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JAMB Economics 2008 Question 20

Question 20

Agriculture

To protect farmers during a bumper harvest, the government usually

  1. A.set a maximum price
  2. B.release products from the buffer stock
  3. C.sell the excess to consumers
  4. D.set a minimum price
Show the answer and explanation

Answer: D (set a minimum price)

Explanation

A bumper harvest pushes prices down; a guaranteed minimum price stops farmers' incomes from collapsing.