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In working these problems, assume that you are a policy analyst working for the Secretary of Agriculture. The information you need to answer the questions

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In working these problems, assume that you are a policy analyst working for the Secretary of Agriculture. The information you need to answer the questions is given in the table below. Note that quantities are given in million hundredweight (cwt) (that means 100 lbs but that is irrelevant for these problems) and prices are given in S/cwi. You may not need all the information given in the table below for every question. You will manually enter your answers into eCampus. ENTER ONLY THE NUMERIC ANSWERS ALONG WITH THE UNITS. DO NOT INCLUDE ANY OTHER WORDS IN YOUR ANSWERS. NOTE: Quantities and dollar values must have THREE decimal places even if they are whole numbers. Prices must be written like this $10.00/cwt and must have TWO decimal places even if they are whole numbers. All prices and values must have dollar signs ($). Write out dollar values in millions as $1,234.567 million. Equilibrium price Before Rice Quantities and Prices elasticities Programs Supply (million cwt) 0.75 189.886 Demand (million ewt) -0.4 189.886 Farm Price ($/cwt) 10.00 Consumer price ($/cwt) 10.00 Target Price (S/cwt) None Support Price (S/cwt) None Government Cost (mil $) None NOTE: -- = Not applicable. 1. The Secretary of Agriculture (Mr. Tom Vilsak) is considering recommending a surplus purchase program for rice to the President with a support price of $14.00/cwt. Before he submits his recommendation, he asks you to determine how much rice the government will have to purchase to support the price of rice at that level and what the cost to the government will be. Fill in the blanks below with your answers to the Secretary. a. Surplus to purchase = b. Cost to the government =_ 2. Congressman Drinksalot is proposing a marketing loan program instead of a government surplus purchase program to support price at a loan rate of $14.00/cwt because he claims it will cost the government less than the surplus purchase program. Secretary Vilsak wants to know whether the Congressman is right and asks you to calculate the cost of the marketing loan program to the government. Fill in the blanks below with your answers to the Secretary. a. Cost of marketing loan program to the government = b. How much more (use "+" sign) or less (use "-" sign) will the Congressman's proposed program cost

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