Calculate the price elasticity of demand for winter wheat

Assignment Help Microeconomics
Reference no: EM131574936

Problem -

US winter wheat production increased dramatically in 1999 after a bumper harvest.  The supply curve shifted rightward; as a result, the price decreased and the quantity demanded increased (a movement along the demand curve). The accompanying table describes what happened to prices and the quantity of wheat demanded.

 

1998

1999

Quantity Demanded (bushels)  

1.74 Billion

1.9 Billion

(Average Price (per bushel)

$3.70

$2.72

Using the chart, solve the following questions:

a) Using the midpoint method, calculate the price elasticity of demand for winter wheat.

b) What is the total revenue for US wheat farmers in 1998 and 1999?

c) Did the bumper harvest increase or decrease the total revenue for American wheat farmers? How could you have predicted this from your answer to part a?

Reference no: EM131574936

Questions Cloud

Describe the mission statement of each organization : Describe at least three (community, state, or national) organizations that are committed to improving access to healthcare for women and minorities.
What impact does an increase in income : What impact does an increase in income(M) have on the equilibrium price and quantity of good x?(Increase, decrease, uncertain). Explain
Collect information using a sample or a population : Statistics 201 is a course taught at a university. Professor Rauch has taught nearly 1,500 students in the course over the past 5 years.
Summarize three different reimbursement methods : "The complexity of financing in health care is one of the primary characteristics of medical care delivery in the United States" .
Calculate the price elasticity of demand for winter wheat : Using the chart, solve the following questions: Using the midpoint method, calculate the price elasticity of demand for winter wheat
Find an infinite set of input instances of max-sat : Find an infinite set of input instances of MAX-SAT for which the expected solutions computed by RSAM are better than the expected solutions computed by RRR.
Solve for the best response functions for each rm : Two firms compete via price competition in a market with differentiated products. Solve for the best response functions for each rm
Find the law in your state that deals with offenses : Find the law in your state that deals with offenses against the person, defenses, and the use of deadly force. Are these concepts statutorily defined
Minimize the overall weight of the vertex cover : Consider the weighted MIN-VC, where every vertex has been assigned a positive integer weight, and the task is to minimize the overall weight.

Reviews

Write a Review

Microeconomics Questions & Answers

  Calculate equilibrium wage and employment if market is free

Suppose the labour market in the house cleaning industry in Quebec City can be described by the following demand and supply equations: LD = 400 - 10w and LS = 40 + 20w. Calculate the equilibrium wage and employment if the market is free.

  Explain what will happen to the interest rate in the short

An economy is facing the inflationary gap shown in the accompanying diagram. To eliminate the gap, should the central bank use expansionary or contractionary monetary policy? How will the interest rate, investment spending, consumer spending, real..

  Exchange in an island economyrobin and terry are stranded

exchange in an island economy.robin and terry are stranded on a deserted island and consume two products coconut and

  Why people may believe police subculture is breaking down

Write a discussion post consisting of 300 words, and discuss the 2 roles of police officers: the public servant and the crime fighter. Utilize current research to explain why some people may believe police subculture is breaking down.

  Find equilibrium price and quantity

Consider a market characterized by the following demand and supply conditions: PX = 15 - 2QX and PX = 3 + 2QX. The equilibrium price and quantity are, respectively, a $3 and 9 units.

  Do the data indicate a difference in proportions of worker

Do the data indicate a difference in the proportions of workers in the two plants who generally approve of managerial decisions? Test at the .05 significance level using the χ2 test.

  What is the firms profit-maximizing output

What is the firm's profit-maximizing output, Q∗? Mark it on the horizontal axison the graph. What price will the firm charge? Mark it on the vertical axis on the graph.

  Explain the short-run adjustment process for the industry

a perfectly competitive firm and industry in long-run equilibrium. A. How do you know that the industry is in long run equilibrium B. Suppose that there is an increase in demand for this product. Show and explain the short-run adjustment process fo..

  What is your own stand on off-shoring

Are the views expressed there contradictory or complementary to the views in your textbook? Give a brief comparison of the two. What is your own stand on off-shoring? Give economically sound arguments to support your position

  What is the bond interest rate

Shannon purchases a bond for $1,142.38. The bond matures in 3 years, and she will redeem it at its face value of $1,200. Interest premiums are paid annually. If Shannon will earn a yield of 5%/year compounded yearly, what is the bond interest rate?

  Determine the settlement or litigation strategy

Determine the settlement or litigation strategy that minimizes firm A's expected total cost (any payment plus legal fees).

  Opportunity to meet doug derito

If you had the opportunity to meet Doug DeRito, what five questions would you ask?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd