Suppose farmers in a given market can either grow soy beans or corn on their land. In addition, suppose an increase in the demand for corn causes the price of corn to increase. All else equal, an increase in the price of corn creates an incentive for farmers to:
A. grow less corn, but not change their production of soy beans.
B. grow more corn, but not change their production of soy beans.
C. switch away from growing soy beans and into growing corn.
D. switch away from growing corn and into growing soy beans.
Answer: C
You might also like to view...
Refer to Figure 9.2. At price 0H and quantity Q1, the deadweight loss is
A) DGC. B) BDC. C) BGC. D) 0FGQ1. E) none of the above
Games that don't have a dominant strategy:
A. do not have stable equilibrium outcomes. B. may have stable equilibrium outcomes. C. always have stable equilibrium outcomes. D. don't exist; all games have at least one dominant strategy.
Charging different prices to different individuals or groups for the same product is called:
A. price discrimination. B. price differentiation. C. quantity discrimination. D. market segmentation.
This graph shows three different budget constraints: A, B, and C.
If Gary has budget constraint A, and the price of milk is $3 a gallon, what is Gary's income?
A. $27 B. $12 C. $9 D. Cannot answer this without knowing the price of soda.