The increased demand for corn to be used in ethanol is driven in large part by nearly $10 billion in government subsidies.
Consider three groups of people:
- Consumers (who are also taxpayers)
- Commodity farmers (who can plant either corn or wheat)
- Cattle ranchers (who buy corn or wheat to feed to livestock)
Of these groups, who gains and who loses as a result of these subsidies?
A. Farmers gain; consumers and ranchers lose.
B. None of these groups gains anything; the only ones to benefit are the ethanol-producing companies.
C. Farmers and consumers gain; ranchers lose.
D. Farmers and ranchers gain; consumers lose