The market for corn is initially in equilibrium. suppose that the production of biofuels, which use corn as an input, increase, and at the same time, increases in the price of oil cause farm production costs to rise. which of the following explains the effect on equilibrium price and quantity in the corn market?
a. the price and quantity of corn will rise.
b. the quantity of corn will rise, but the effect on equilibrium price cannot be determined without more information.
c. the quantity of corn will fall, but the effect on equilibrium price cannot be determined without more information.
d. the price and quantity of corn will fall.
e. the price of corn will rise, but the effect on equilibrium quantity cannot be determined without more information.
Answers: 2
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The market for corn is initially in equilibrium. suppose that the production of biofuels, which use...
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