Asked by Jeancarlos Chavarro on Jul 14, 2024
Verified
Which of the following illustrates the basic idea of "parity" as a cornerstone of U.S. agricultural policy?
A) The price of corn per bushel should be held constant.
B) A bushel of corn should exchange for more of all goods today than previously because farm incomes have declined.
C) If a bushel of corn exchanged for a pair of pants at a previous time, the same rate of exchange should prevail today.
D) If a bushel of corn exchanged for a pair of pants at a previous time, the rate of exchange today should be two bushels of corn for one pair of pants since productivity in farming has increased faster than in pants manufacturing.
Parity
The state or condition of being equal, especially regarding status or pay, or in finance, an equivalence in value or standing.
Agricultural Policy
A set of laws and regulations adopted by a government to control the agricultural sector's market, including prices, subsidies, and support for farmers.
Exchange Rate
The price at which the currency of one country can be exchanged for the currency of another country.
- Apprehend the idea and ramifications of balance in farm regulation.
Verified Answer
NM
Nidhi MishraJul 16, 2024
Final Answer :
C
Explanation :
The basic idea of "parity" in U.S. agricultural policy is to maintain the same purchasing power for farm products over time, meaning if a bushel of corn could be exchanged for a pair of pants in the past, the same exchange rate should apply today.
Learning Objectives
- Apprehend the idea and ramifications of balance in farm regulation.