Question

Watch this video about how an apple farmer decides the optimal number of apples to pick. At the end of the video, consider whether or not the government should intervene in this (somewhat) perfectly competitive market. Think about which arguments you might make both supporting and disagreeing with the government acting in the market. Post your conclusions on the discussion board.

Answer 1

If the apples are left over, without harvesting this would result in social loss. To avoid this loss, government need to intervene directly by providing subsidies or indirectly helping to harvest by providing tool required for harvest so that the apples can be harvest at no loss. If the support is not extended and let to behave as per the market then the price of the apples needs to be increased which might lead to reduce consumption. So, the government support would help in avoiding social loss and help to sustain the apple business