Farm programs such as those of the United States and the European Union cause a misallocation of international agricultural resources primarily because

A) they distort domestic and world agricultural prices.
B) they inhibit technological progress in agriculture.
C) production and trade occur on the basis of comparative advantage.
D) price supports are set below market-clearing levels.

Misallocation

Refers to an inefficient distribution of resources in a market or economy, often leading to suboptimal outcomes.

Agricultural Resources

The inputs used in the cultivation of crops and the rearing of animals for food, fibers, and other agricultural products.

World Agricultural Prices

The international prices for agricultural products, influenced by factors such as supply, demand, and political events.