1.Producers may choose between the ARC-CO and PLC programs for each crop for which they have base acres on the farms they operate. A producer wants your advice on which of the two programs to choose for their corn base acres:a.Explain the difference between the two programs to them, in particular with respect to which market developments each program will protect against (5 points)b.The producer notes that fertilizer and other input prices have risen strongly in recent months. Are either of these programs designed to address change in input costs? Briefly explain why or why not.(5 points)2. The Ministry of Agriculture in Zambia is considering a scheme to subsidize inputs in the country.a. What are some common problems that input subsidy programs in Zambia have faced in the past? (3 points)b. The Minister is worried that input subsidies would push up land prices, as he has seen studies of the U.S. and EU that show that much of the value of agriculture support policies ends up being transmitted to land prices. Should this be a concern? How might this impact the success of the scheme? (3 points)
