Defines the weekly market supply and demand for corn

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Suppose the following market schedule defines the weekly market supply and demand for corn (in thousands of bushels): Price ($) 1 2 3 4 5 Quantity? 3 6 9 12 15 Quantity? 15 12 9 6 3 (a) Plot the market demand and supply (b) What is the equilibrium price? (c) Show and explain what will happen if policy makers decide to regulate the price at $4 per bushel. (d) Using an illustration, discuss the economic implications of the regulatory price if a substantial number of wheat farmers decide to produce and supply more corn—at the regulated price—instead of wheat. (e) Correctly estimate and briefly discuss the consumer response (price elasticity coefficient) to an increase in the price of corn from $3 to $4 per bushel.

Reference no: EM131004750

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