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. switch away from growing soy beans and into growing corn.
B. switch away from growing corn and into growing soy beans.
C. grow less corn, but not change their production of soy beans.
D. grow more corn, but not change their production of soy beans.
Answer: A
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In terms of the production possibilities diagram, the principle of increasing cost simply asserts that the frontier is
A. downward sloping. B. upward sloping. C. bowed inward. D. bowed outward. E. undefined, because no market will exist in this case.
Suppose the marginal value of bread in terms of wine is 1/2 bottle of wine per loaf of bread, while the relative price of bread in terms of wine is 1/4 bottle of wine per loaf of bread. Explain how the consumer can adjust his purchases to raise his level of satisfaction.
What will be an ideal response?
Net national product equals
A) gross national product minus statistical discrepancy. B) gross national product minus depreciation. C) national income minus taxes on production and imports. D) national income plus depreciation.
The exporting trade in the United States has had a significant impact on the U.S. economy. In 2016, exports accounted for 11 million jobs—an increase of 3.3 million jobs since the 2009 recession. Which of the following is true about the impact of U.S. exports on the global economy?
a. During the time period from 2009-2016, exports have decreased in importance for the US. economy. b. China and Mexico are our best partners for our exports. c. The increase in trade volume over the past 65 years has been one of the most important factors in the rise of the living standards around the world d Globalization represents a huge opportunity for wealthy nations but while it may creat