Question

How did the New Deal policy of loaning money to farmers help create higher prices for farm goods?
It permitted farmers to buy land, thus raising prices on crops grown there.
It permitted farmers to invest money, thus relieving them of the need to work.
It permitted farmers to produce fewer farm goods, thus raising prices.
It permitted farmers to produce more farm goods, thus raising prices.

Answer 1

It permitted farmers to produce fewer farm goods, thus raising prices.

Explanation: New Deal programs (like the AAA and CCC loans/price supports) paid or loaned money so farmers could cut acreage or withhold crops from the market, reducing supply and helping raise farm prices.