2. Nick is a row crop farmer who is currently growing 450 acres of conventional corn. He is currently able to raise 200 bushel per acre of corn and can sell it for $4.50/bushel on average. He is considering switching to growing food-grade white corn. If he does this he estimates he will raise 160 bushel per acre of corn and will be able to contract with a local tortilla factory and sell it for $6.25/bushel. If he does this, it will increase his costs by $85/acre. What is his net change in profit if he switches to white corn? Additional Costs Reduced Revenue Total AC + RR = $ Additional Revenue Reduced Costs Total AR+ RC = Net Change in Profit =
2. Nick is a row crop farmer who is currently growing 450 acres of conventional corn. He is currently able to raise 200 bushel per acre of corn and can sell it for $4.50/bushel on average. He is considering switching to growing food-grade white corn. If he does this he estimates he will raise 160 bushel per acre of corn and will be able to contract with a local tortilla factory and sell it for $6.25/bushel. If he does this, it will increase his costs by $85/acre. What is his net change in profit if he switches to white corn? Additional Costs Reduced Revenue Total AC + RR = $ Additional Revenue Reduced Costs Total AR+ RC = Net Change in Profit =
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:2. Nick is a row crop farmer who is currently growing 450 acres of conventional corn.
He is currently able to raise 200 bushel per acre of corn and can sell it for
$4.50/bushel on average. He is considering switching to growing food-grade white
corn. If he does this he estimates he will raise 160 bushel per acre of corn and will be
able to contract with a local tortilla factory and sell it for $6.25/bushel. If he does this,
it will increase his costs by $85/acre. What is his net change in profit if he switches to
white corn?
Additional Costs
Reduced Revenue
Total AC + RR = S
Additional Revenue
Reduced Costs
Total AR + RC =
Net Change in Profit
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