One of the growers is concerned about the price decrease caused by the spell of good weather because he feels it will lower revenue in this market. AS an economics student, you can use elasticities to determine whether this change in price will lead to an increase or decrease in total revenue in this market. Using the midpoint method, the price elasticity of demand for corn between the prices of $10 and $8 per bushel is_▼ , which means demand is between these two points. Therefore, you would tell the grower that his claim is , because total revenue will ▼ as a result of the spell of good weather. Confirm your previous conclusion by calculating total revenue in the corn market before and after the spell of good weather. Enter these values in the following table. Before Spell of Good Weather After Spell of Good Weather Total Revenue (Millions of Dollars)
One of the growers is concerned about the price decrease caused by the spell of good weather because he feels it will lower revenue in this market. AS an economics student, you can use elasticities to determine whether this change in price will lead to an increase or decrease in total revenue in this market. Using the midpoint method, the price elasticity of demand for corn between the prices of $10 and $8 per bushel is_▼ , which means demand is between these two points. Therefore, you would tell the grower that his claim is , because total revenue will ▼ as a result of the spell of good weather. Confirm your previous conclusion by calculating total revenue in the corn market before and after the spell of good weather. Enter these values in the following table. Before Spell of Good Weather After Spell of Good Weather Total Revenue (Millions of Dollars)
Microeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter9: Price Takers And The Competitive Process
Section: Chapter Questions
Problem 11CQ
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