Refer to the scenario above. If the government enforces a ban on Firm B, and asks Firm A to carry out all the production:
A) Firm A's marginal cost is likely to decrease, but its average cost is likely to increase.
B) Firm A's marginal cost and average cost are likely to decrease.
C) Firm A's marginal cost is likely to increase, but its average cost is likely to decrease.
D) Firm A's marginal cost and average cost are likely to increase.
D
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In 2012, Canadian farmers did not suffer from drought conditions that affected the United States, but they did enjoy the higher corn prices. Canadian farmers reacted to the higher price by planting more corn
Suppose that the price of corn increased by 30 percent and the Canadian farmers increased the quantity of corn they supply by 20 percent. The supply of corn is A) perfectly inelastic. B) unit elastic. C) elastic. D) inelastic.
In general, agricultural price supports
A) raise food prices. B) have no impact on food prices. C) are designed to lower food prices. D) c and d