Using the midpoint method, the price elasticity of demand for wheat between the prices of s10 and $8 per bushel is, which means demand isbetween these two points. Therefore, you would tell the grower that his claim isbecause total revenue willas a result of the spell of good weather.Confirm your previous conclusion by calculating total revenue in the wheat market before and after the spell of good weather. Enter these values inthe following table.Before Spell of Good WeatherAfter Spell of Good WeatherTotal Revenue (Millions of Dollars)Grade It NowSave & Continue 14. Application: Demand elasticity and agricultureConsider the market for wheat. The following graph shows the weekly demand for wheat and the weekly supply of wheat. Suppose a spell of unusuallygood weather occurs, which enables wheat producers to generate more wheat per acre of land.Show the effect this shock has on the market for wheat by shifting the demand curve, supply curve, or both.Note: Select and drag one or both of the curves to the desired position. Curves will snap into position, so if you try to move a curve and it snaps backto its original position, just drag it a little farther.20SupplyDemand16SupplyDemand1020304050QUANTITY (Milions of bushels)One of the growers is concerned about the price decrease caused by the spell of good weather because he feels it will lower revenue in this market. Asan economics student, you can use elasticities to determine whether this change in price will lead to an increase or decrease in total revenue in thismarket.PRICE (Dallars per bushel)

(i) Following below is the graph depicting the effect of the shock on the demand and supply curve:…

Using the midpoint method, the price elasticity of demand for wheat between the prices of s10 and $8 per bushel is which means demand is between these two points. Therefore, you would tell the grower that his claim is because total revenue will as a result of the spell of good weather. Confirm your previous conclusion by calculating total revenue in the wheat market before and after the spell of good weather. Enter these values in the following table. Before Spell of Good Weather After Spell of Good Weather Total Revenue (MIIllons of Dollars) Grade It Now Save & Continue

Using the midpoint method, the price elasticity of demand for wheat between the prices of s10 and $8 per bushel is which means demand is between these two points. Therefore, you would tell the grower that his claim is because total revenue will as a result of the spell of good weather. Confirm your previous conclusion by calculating total revenue in the wheat market before and after the spell of good weather. Enter these values in the following table. Before Spell of Good Weather After Spell of Good Weather Total Revenue (MIIllons of Dollars) Grade It Now Save & Continue

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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