A Perfectly Competitive Wheat Farmer in a Constant-Cost Industry Produces

question 61

Multiple Choice

A perfectly competitive wheat farmer in a constant-cost industry produces 3,000 bushels of wheat at a total cost of $36,000.The prevailing market price is $15.What will happen to the market price of wheat in the long run?

• A)The price remains constant at $15.
• B)The price falls to $12.
• C)The price rises above $15.
• D)There is insufficient information to answer the question.

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Definitions:

Causal Influence

The effect that one variable, event, or action has in directly causing another.

Research Method

A systematic approach to investigating questions or hypotheses by collecting and analyzing data.

Experiment

A method of research in the sciences and social sciences where variables are manipulated to observe the effects on some behavior or mental process.

Longitudinal Design

A research design that involves repeated observations or measurements of the same variables over extended periods of time.