Asked by Tomas Calderaro on May 14, 2024
Verified
Assume soybeans are produced in a perfectly competitive market. A soybean farmer is currently maximizing his profits. If the market price of soybeans falls, after the farmer adjusts to the new price, he will be producing ________ bushels of soybeans, and his profit will be ________.
A) fewer; the same
B) fewer; lower
C) more; the same
D) the same number of; the same
Market Price
The current price at which an asset or service can be bought or sold in a marketplace.
Profit
The financial gain realized when the amount earned from a business activity exceeds the expenses, costs, and taxes needed to sustain the activity.
Bushels
A measure of volume commonly used in agriculture, especially in the United States, for quantifying crops like grains, fruits, and vegetables.
- Understand the concept of profit maximization for firms in perfectly competitive markets.
- Apply the provided data to ascertain the full revenue, expenditure, and profit figures.
Verified Answer
Learning Objectives
- Understand the concept of profit maximization for firms in perfectly competitive markets.
- Apply the provided data to ascertain the full revenue, expenditure, and profit figures.
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