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The graph below shows the cost curves MC and ATC for a typical farm in a perfectly competitive market for wheat The graph also shows the market supply of wheat S and the market demand

The graph below shows the cost curves (MC and ATC) for a typical farm in a perfectly competitive market for wheat. The graph also shows the market supply of wheat (S), and the market demand for wheat, which increases from D1 to D2. (Assume that wheat production is a constant-cost industry.) Typical farm and market In the scenario above, in the new short-run equilibrium a typical farm produces thousand bushels of wheat (enter a whole number, e.g., 50) and sells it at $ per bushel (enter a number with 2 digits after the decimal point, e.g., 3.00). In the scenario above, in the new short-run equilibrium, a typical farm's economic profit is: Positive Zero Negative In the scenario above, the new long-run equilibrium occurs where a typical farm produces thousand bushels of wheat (enter a whole number, e.g., 50) and sells it at $ per bushel (enter a number with 2 digits after the decimal point, e.g., 3.00). In the scenario above, in the new long-run equilibrium, a typical farm's economic profit is: Positive Zero Negative

May 26 2020 View more View Less

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