Discussion question #1 – Draw two graphs side-by-side that show the market equilibrium price for soy...

Discussion question #1 – Draw two graphs side-by-side that show the market equilibrium price for soy beans as $3 per pound. The second graph is for Sally the soy bean farmer whose profit maximizing output is 80 pounds of soybeans. Show on your graph Sally making a profit of $140 at the market price of $3. Label all curves you draw and clearly indicate the profit region.
1. Is the above scenario a short-run or long-run equilibrium?
2. If it is not a long-run equilibrium, tell me how you know this?
3. What do you expect to happen in the long-run?
4. What effect will these long run changes have on either the supply or demand curve in the U.S. Soy bean market?
5. What effect will these long run soy bean market changes have on Sally the soy bean farmer?
6. What happens in the long run to soy bean prices?
7. What happens in the long run to the quantity of soy beans produced in the market?
8. What happens in the long run to the quantity of soy beans produced by Sally?

draw 2 graphs below Label the initial equilibrium points “A” in both graphs below…label the new long-run equilibrium points “B” on your graph below.

Expert Solution

Rahul Sunny answered 2 years ago

Draw two graphs side-by-side that show the market equilibrium price for soy beans as $3 per...

Draw two graphs side-by-side that show the market equilibrium price for soy beans as $3 per pound. The second graph is for Sally the soy bean farmer whose profit maximizing output is 80 pounds of soybeans. Show on your graph Sally making a profit of $140 at the market price of $3. Label all curves you draw and clearly indicate the profit region. 1. What effect will these long run changes have on either the supply or demand curve in...

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