Until recently, angora goat wool (mohair) has been designated as a strategic commodity (it used to be utilized in some military clothing). Because of that, in 1992 for every dollar's worth of mohair sold to manufacturers, ranchers received $3.60.
a. Demonstrate graphically the effect of eliminating this designation and subsidy.
b. Why was the program likely kept in existence for so long?
c. Say that a politician has suggested that the government should pass a law that requires all consumers to pay a price for angora goat wool high enough so that the sellers of that wool would receive $3.60 more than the market price. Demonstrate the effect of the law graphically. Would consumers support it? How about suppliers?