A Friend Suggests That the Use of Corn for Ethanol

question 59

Multiple Choice

A friend suggests that the use of corn for ethanol production is causing a rise in corn prices and corn shortages that essentially starve children to fuel American cars.Wondering if that might really be true,you investigate and learn something that suggests this relationship is not true.You find out that

• A)most of the money saved by using ethanol is used by charitable organizations that feed the poor.
• B)the process of making ethanol also produces antibiotics to help prevent human diseases.
• C)although corn prices have risen,much more corn is now being planted and the prices of other crops have risen more than corn.
• D)ethanol production uses part of corn not used to feed either animals or humans.

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Definitions:

Coffee Beans

The seed of the coffee plant, used to produce the popular beverage coffee, following a process of drying, roasting, and grinding.

Essential

Refers to goods or services considered necessary for basic human functioning and living standards.

Marginal Rate of Substitution

The speed at which a consumer is ready to replace one product with another, keeping their level of contentment constant.

Marginal-Utility Analysis

An economic method that evaluates how the addition of one more unit of consumption affects overall utility.