In the real world, many U.S. markets are not perfectly open or free markets with the consumer as sovereign. For example, consumers cannot buy illegal drugs or body organs. In Chapter 4, you learned that the U.S. government has set minimum prices (support prices) for wheat, milk, cheese, and other products. These markets are free only if the market price is above the support price. Similarly, the minimum wage law forces employers to pay a wage above some dollar amount per hour regardless of market conditions. What is the purpose of setting minimum prices (support prices) for certain products in the U.S. market?
1) To ensure that consumers have access to affordable products
2) To prevent the market price from falling below a certain level
3) To encourage competition among producers
4) To regulate the supply and demand of certain products