In the rural area of a large agricultural-based economy in which corn is the staple food, there are many small farmers, each of them planting corns in a small piece of land using the same plantation method. Upon harvesting, they will deliver their corns to the city and sell them to the large population of customers in the city. The corn farmers do not have any bargaining power in determining the price of their corns. The corn price is determined by the market demand and supply, but each farmer will have no problem selling all their corns at the market equilibrium price. It is discovered that consuming corn is beneficial to health. Appraise the short run and the long run effects on the corn market as well as the individual corn farmer following this discovery. (Your answer should not be more than 400 words).
In the rural area of a large agricultural-based economy in which corn is the staple food, there are many small farmers, each of them planting corns in a small piece of land using the same plantation method. Upon harvesting, they will deliver their corns to the city and sell them to the large population of customers in the city. The corn farmers do not have any bargaining power in determining the price of their corns. The corn price is determined by the market demand and supply, but each farmer will have no problem selling all their corns at the market equilibrium price. It is discovered that consuming corn is beneficial to health. Appraise the short run and the long run effects on the corn market as well as the individual corn farmer following this discovery. (Your answer should not be more than 400 words).
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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In the rural area of a large agricultural-based economy in which corn is the staple food, there are many small farmers, each of them planting corns in a small piece of land using the same plantation method. Upon harvesting, they will deliver their corns to the city and sell them to the large population of customers in the city. The corn farmers do not have any bargaining power in determining the price of their corns. The corn price is determined by the market demand and supply, but each farmer will have no problem selling all their corns at the market equilibrium price.
It is discovered that consuming corn is beneficial to health. Appraise the short run and the long run effects on the corn market as well as the individual corn farmer following this discovery. (Your answer should not be more than 400 words).
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