Returning to the corn example from before, what would happen if the government placed a price floor of $2 per bushel of corn to help Indiana (and other) farmers get through the Covid Crisis? Use this table of supply and demand to answer the question. Corn Supply and Demand Bushels Demanded Price per Bushel Bushels Supplied 47 $6 79 52 $5 75 58 $4 70 63 $3 63 69 $2 59 O The price would fall below $2 because the floor is not binding. O This would create a surplus in the corn market. O This would create a shortage in the corn market O Indiana farmers would switch to a different crop to avoid the resulting lower corn prices. O Absolutely nothing.

Returning to the corn example from before, what would happen if the government placed a price floor of $2 per bushel of corn to help Indiana (and other) farmers get through the Covid Crisis? Use this table of supply and demand to answer the question. Corn Supply and Demand Bushels Demanded Price per Bushel Bushels Supplied 47 $6 79 52 $5 75 58 $4 70 63 $3 63 69 $2 59 O The price would fall below $2 because the floor is not binding. O This would create a surplus in the corn market. O This would create a shortage in the corn market O Indiana farmers would switch to a different crop to avoid the resulting lower corn prices. O Absolutely nothing.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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