Question

Who benefited from the legislation that set target prices on sugar derived from sugar cane

Answer 1

The U.S. sugar farmers benefited from legislation setting target prices on cane sugar, as it provided them with subsidies and tariffs on imports to protect the domestic industry. However, this led to higher domestic sugar prices and impacted manufacturers who use sugar, prompting some to move operations abroad.

Step-by-step explanation:

The legislation that set target prices on sugar derived from sugar cane primarily benefited U.S. sugar farmers. By providing subsidies and establishing tariffs on imported sugar, the U.S. government aimed to protect domestic sugar production and ensure higher prices for American sugar farmers. This protectionist policy resulted in the restriction of sugar imports, particularly from countries like Cuba and Brazil, which in turn helped maintain the domestic sugar industry's profitability. However, these policies have had broader economic impacts, namely, making cane sugar more expensive domestically. Additionally, manufacturers of sugary products, such as candy and soda companies, face higher costs, which has led some to relocate production to countries with cheaper sugar prices.

Protectionism through tariffs and subsidies can lead to reduced international trade and return prices to pre-trade levels. This has a dramatic impact on the sugar market and highlights the complex dynamics between trade liberalization and protectionist policies.

Answer 2

Incomplete question. I inferred you are referring to who benefits from a price ceiling.

Step-by-step explanation:

Note, target prices or price ceiling usually imply that the price of a particular commodity has a benchmark where it is not allowed to beyond the amount.

For example, if a bag of sugar derived from sugar cane is set by legislation to be $10 from its initial price of $17, it, therefore, means that buyers would be the ones to benefit from the cost savings. However, if in a rare situation the target prices increase from its initial price (let's say from $17 to $22), then it means the producers would have benefitted from the legislation, not the buyers.