If the long-run supply of rice is perfectly elastic, then
A) as people's incomes rise, the quantity of rice supplied decreases.
B) as the price of corn falls, the quantity of rice demanded decreases.
C) in the long run, a large rise in the price of rice causes no change in the quantity of rice supplied.
D) in the long run, an increase in the demand for rice leaves the price of rice unchanged.
D
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10% of the total food grains produced in a country during a year got damaged due to poor storage. Which of the following will happen in this case?
A) Imports will fall. B) Trade surplus will increase. C) GDP will remain unchanged. D) GDP will decrease.
A perfectly competitive wheat farmer in a constant-cost industry produces 3,000 bushels of wheat at a total cost of $36,000. The prevailing market price is $15. What will happen to the market price of wheat in the long run?
A) The price falls to $12. B) The price rises above $15. C) The price remains constant at $15. D) There is insufficient information to answer the question.