Microeconomics (2nd Edition) (Pearson Series in Economics)
2nd Edition
ISBN: 9780134492049
Author: Daron Acemoglu, David Laibson, John List
Publisher: PEARSON
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Question
Chapter 7, Problem 3Q
To determine
The effect of invisible hand in moving corn prices, when
(a) Flood destroys the large volume of corn crops
(b) The price of corn substitute, say wheat rises.
(c) There is a change in consumers’ tastes from corn dogs to hot dogs.
(d) There is an increase in the number of consumers’ access to the corn market.
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Students have asked these similar questions
Consider the market for corn. Indicate whether each of the following events will cause a rightward shift in the demand curve (select
all that apply).
A A drought hits corn-growing regions, cutting the supply of corn.
B The government announces a new subsidy for biofuels made from corn.
A global recession reduces the incomes of consumers in poor countries, who rely on corn as a staple food (assuming corn
is a normal good).
D A new hybrid variety of corn seed causes a 15 percent increase in the yield of corn per acre.
E An advertising campaign by the beef producers' association highlights the health benefits of corn-fed beef.
Provide short answer for the following.
1.Is the demand for table salt elastic or inelastic? Why?
2.Is the demand for stereos elastic or inelastic? Why?
3.Why is it that the production possibilities curve is bowed outward?
4.Why has the government placed price floors on some agricultural goods?
5. Income effect of a price change.
There was a disruption in production and shipment of fertilizer when Russia invaded Ukraine in March 2022. How does the event in the market for fertilizer transition into the market for food. Explain and draw the graphs for both the markets.
Chapter 7 Solutions
Microeconomics (2nd Edition) (Pearson Series in Economics)
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Similar questions
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