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The graph shows a hypothetical market for wheat. Intially, this market is in equilibrium at a market price of $5 per bushel and a quantity
The graph shows a hypothetical market for wheat. Intially, this market is in equilibrium at a market price of $5 per bushel and a quantity of 400,000 bushels per week. Suppose the government begins to pay a subsidy to wheat farmers. The result is a shift of the supply curve to Supply2. Use the interactive graph to highlight the deadweight loss that results from the subsequent overproduction that occurs as a result of this subsidy.
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