Economics in Agriculture
12th Grade · Social Studies · 99 min· Ag Economics
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Learning Objective
I can analyze how economic principles affect agricultural production and consumption.
- 1
Price ceilings and price floors are types of price controls that can lead to market inefficiencies.
- 2
A price ceiling set below the equilibrium price leads to a shortage and deadweight loss, while a price floor set above the equilibrium price leads to a surplus and deadweight loss.
- 3
Subsidies are government payments to individuals or businesses that can distort markets, but may be justified in cases where the market produces less than what society wants, such as with renewable energy.
