A recent news report lamented the plight of corn farmers in Wisconsin due to a severe drought. Which of the following best describes the effect on corn farmers in Minnesota, where sufficient rainfall occurred?
a. Their revenue increases because price increases and demand is elastic.
b. Their revenue increases because price increases and demand is inelastic.
c. Their revenue decreases because price decreases and demand is inelastic.
d. Their revenue decreases because price increases and demand is elastic.
b
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According to the law of demand, all else constant, a rise in price will decrease the demand for a good, and a decrease in price will increase demand for a good
a. True b. False Indicate whether the statement is true or false
If the firms in a competitive price-searcher market are earning zero economic profit, this indicates that the
a. market is not in long-run equilibrium. b. firms are earning the normal rate of return. c. firms are performing worse than the firms in other markets. d. firms are performing better than firms in other markets.