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Re: Farmers in developing countries claim that the U.S. governme [#permalink]
Why not C?
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Re: Farmers in developing countries claim that the U.S. governme [#permalink]
Carcass , could you please explain why D ? and not B
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Re: Farmers in developing countries claim that the U.S. governme [#permalink]
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Breaking down the arguments always into small chunks. The process is a bit slow, apparently, but you gain in accuracy and in the end, is faster

Farmers in developing countries claim that the U.S. government, through farm subsidies, is responsible for the artificially low global price of wheat.

Farmers in some regions, such as Africa, claim that the US wheat price is lower than others or in general on a global scale because of grants or Gov helps. They are technically called State interventions, that in the end is an artificial distortion of the market and competition

Because the U.S. government buys whatever wheat American farmers are unable to sell on the open market, American farmers have no incentive to modulate the size of their crops according to the needs of the global market.

Ok : the US gov pays for the wheat. Therefore, the farmers are able to keep the prices lowers than others farmers

As a result, American farmers routinely produce more wheat than the global market can absorb and the global price of wheat is kept low.

The result is bigger production per ton by the farmers. Of course, they produce more because they have already the customer: the US Gov


Without these subsidies, the farmers in developing economies claim, American farmers would produce only the amount of wheat that they could sell on the open market and the global price of wheat would rise.

If the farmers did not have the grants, then the prices were leveled and aligned to those normal on the market



Which of the following, if true, most weakens the claims of the farmers in developing countries regarding the price of wheat?

(A) Wheat that is not processed for consumption is often used for certain industrial applications.

This is not an explanation. We care about the prices and why the farmers in other countries are wrong. Consumption is not our concern

(B) Non-governmental buyers of wheat and wheat products are able to predict how much wheat they will need several years in advance.

The production forecast for the coming years does not tell us anything

(C) The U.S. government offers similar subsidies to soybean farmers, though the global price of soybeans is significantly higher than that of wheat.

The fact that the US gov grants a similar effect to another basic product is irrelevant. We need why the farmers are wrong and the US gov is doing nothing wrong

(D) Other countries, such as Canada and Russia, are likely to produce more wheat if the United States were to reduce its output.

This is a valid reason: OTHERS countries are injected more wheat on the global market. Therefore, the price is low due to this massive production. The US gov intervention is relative

(E) The price of sorghum, a crop for which the U.S. government offers no subsidies, is lower than that of wheat.

Stupid comparison. We do not care whatsoever


Hope this helps
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