Show what happens in the short run on both graphs when a new medical study shows soybeans to be highly carcinogenic. On the market graph, you will shift a curve or curves. On the firm's graph, use Price 2 to draw a new price line for the firm. On both graphs, indicate the new equilibrium point with point B.Now, show the changes that get both graphs back to long‑run equilibrium. Use shift(s) for the market and Price 3 for the firm. Indicate the new long‑run equilibrium with point C. individual firm in the market for soybeans. The market and the firm are currently in long-run equilibrium at point A.Soybean marketRoy's Soys2020Price 2Price 319Short-run supply19Marginal cost1818171716161515141413131212Average total costA 118 1011A10ALong-run supplyPrice9.774433Demand2110 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20Quantity (millions of bushels)0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20Quantity (hundreds of bushels)1. Show what happens in the short run on both graphs when a new medical study shows soybeans to be highlycarcinogenic. On the market graph, you will shift a curve or curves. On the firm's graph, use Price 2 to draw a new priceline for the firm. On both graphs, indicate the new equilibrium point with point B.2. Now, show the changes that get both graphs back to long-run equilibrium. Use shift(s) for the market and Price 3 for thefirm. Indicate the new long-run equilibrium with point C.Price ($)

Answer: (1). When a new medication study shows that soybeans are carcinogenic then the demand for…

Answered: Show what happens in the short run on…

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: Firms In Competitive Markets

Section: Chapter Questions

Problem 9PA

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Show what happens in the short run on both graphs when a new medical study shows soybeans to be highly carcinogenic. On the market graph, you will shift a curve or curves. On the firm's graph, use Price 2 to draw a new price line for the firm. On both graphs, indicate the new equilibrium point with point B.
Now, show the changes that get both graphs back to long‑run equilibrium. Use shift(s) for the market and Price 3 for the firm. Indicate the new long‑run equilibrium with point C.

individual firm in the market for soybeans. The market and the firm are currently in long-run equilibrium at point A.
Soybean market
Roy's Soys
20
20
Price 2
Price 3
19
Short-run supply
19
Marginal cost
18
18
17
17
16
16
15
15
14
14
13
13
12
12
Average total cost
A 11
8 10
11
A
10
A
Long-run supply
Price
9.
7
7
4
4
3
3
Demand
2
1
1
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Quantity (millions of bushels)
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Quantity (hundreds of bushels)
1. Show what happens in the short run on both graphs when a new medical study shows soybeans to be highly
carcinogenic. On the market graph, you will shift a curve or curves. On the firm's graph, use Price 2 to draw a new price
line for the firm. On both graphs, indicate the new equilibrium point with point B.
2. Now, show the changes that get both graphs back to long-run equilibrium. Use shift(s) for the market and Price 3 for the
firm. Indicate the new long-run equilibrium with point C.
Price ($)

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