Consider the following facts.62 a. Easing drought conditions in the Black Sea wheat belt are causing world wheat production to recover. b. China is consuming nearly a quarter of the U.S. soybean crop to feed its hogs and chickens that are demanded by its expanding middle class. c. Farmers have typically responded to high prices by planting more land. d. The USDA predicts that U.S. farmers will increase the land used for the nation s eight largest crops by 9.8 million acres, the biggest change in 15 years. e. Possible civil war in cocoa-producing Ivory Coast increased prices to the highest levels in 32 years despite increased production last year. f. Weather problems in major wheat-producing countries such as Canada and Russia caused world wheat production to drop 5.5 percent. Using standard demand and supply curves, describe and illustrate the effect on equilibrium price and quantity of each of these changes in the particular commodity market.
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