- 1) In western Kansas, corn can be grown in two ways with or without irrigation. Dryland farmers, who do not irrigate their corn, have long-run average costs: LAC, q-20q+105 and long-run marginal costs: LMC,,= 3q²-40q+105 where is measured in thousands of bushels. Farmers lucky enough to have water rights or river access have lower costs: Their long-run average cost is LAC, q-16q+67 and their long-run marginal cost is LMC, = 3q²-32q+67 a. If the corn market is in long-run equilibrium, with both dryland and irrigated corn being sold, what must the price of corn be?

- 1) In western Kansas, corn can be grown in two ways with or without irrigation. Dryland farmers, who do not irrigate their corn, have long-run average costs: LAC, q-20q+105 and long-run marginal costs: LMC,,= 3q²-40q+105 where is measured in thousands of bushels. Farmers lucky enough to have water rights or river access have lower costs: Their long-run average cost is LAC, q-16q+67 and their long-run marginal cost is LMC, = 3q²-32q+67 a. If the corn market is in long-run equilibrium, with both dryland and irrigated corn being sold, what must the price of corn be?

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter11: The Firm: Production And Costs

Section: Chapter Questions

Problem 2P

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