Microeconomics (MindTap Course List)
10th Edition
ISBN: 9781285859484
Author: William Boyes, Michael Melvin
Publisher: Cengage Learning
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Chapter 10, Problem 15E
To determine
To explain:
The reasons for rise in corn prices from $1 per unit in 2004 to $6 per unit in 2011.
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Microeconomics (MindTap Course List)
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- Suppose that the development of a new drought-resistant hybrid seed corn leads to a 50 percent increase in the average yield per acre without increasing the cost to the farmers who use the new technology. If the producers in the corn production industry were price takers, what would happen to the following? a. the price of corn b. the profitability of corn farmers who quickly adopt the new technology c. the profitability of corn farmers who are slow to adopt the new technology d. the price of soybeans, a substitute product for cornarrow_forwardIdentify a real world industry that may show either many firms entering or exiting the competitive marketplace in the next few months and explain in microeconomic terms why.arrow_forwardIn perfect competition, each company generates a fraction of the total production so small that increasing or decreasing its production will have a perceptible influence on the total supply and the price of the product. True or falsearrow_forward
- What is the Imperfect competition that refers to any form of market structure other than perfect competition?arrow_forwardSuppose the market price of sugar is 22 cents per pound. If a sugar farmer produces 100,000 pounds, the marginal cost of sugar is 30 cents per pound. Is the farmer maximizing profit? If not, should the farmer produce more or less sugar?arrow_forwardIn the long run, in a competitive economy, companies use resources until the extra or marginal production costs are: 1. Less than the price of the product 2. Greater than the price of the product 3. Equal to the price of the product 4. Equal to your earningsarrow_forward
- Which market offers higher consumer surplus and why? The perfectly competitive firm or the monopoly firm?arrow_forwardDiscuss in detail the short and long run laws of production.arrow_forwardYou witnessed new firms entering a competitive market. What can you infer for the existing firms in that market?arrow_forward
- Farmer Brown grows peaches in Georgia. Suppose the market for peaches is perfectly competitive and that the market price for a box of peaches is $40 per box. Farmer Brown's marginal cost of production is illustrated in the table. Boxes of Market Price Marginal Cost (MC) Peaches (per box) $40 12.00 6.00 18.00 36.00 1 40 40 40 4 40 5 40 72.00 6 40 108.00 What price will farmer Brown charge when maximizing profit? Farmer Brown will charge a price of $ per box of peaches. (Enter your response as an integer.) What is farmer Brown's profit-maximizing level of output? Farmer Brown maximizes profit when producing boxes of peaches. (Enter your response as an integer.)arrow_forwardExplain how market competition affect the mark –up in price setting and the fraction of the marginal product that the firm retains as profitarrow_forwardWhat is the number of firms in a Perfect Competition and what is the price control of product by individual firms.arrow_forward
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