Question: Crop Prices Erode Farm Subsidy Program High corn and soybean prices mean farmers are making the most money in their lives. The reason: Grain prices are far too high to trigger payouts under the U.S. primary farm-subsidy program's "price support" formula. The market has done what Congress couldn't do and that is "slash farm subsidies."
Show in a graph how a subsidy paid to soybean farmers affects the consumer surplus and the producer surplus from soybeans. Does the subsidy make the soybean market more efficient or less efficient? Explain.