Suppose That Corn Farmers Want to Increase Their Total Revenue

question 8

Multiple Choice

Suppose that corn farmers want to increase their total revenue.Knowing that the demand for corn is inelastic,corn farmers should

• A)plant more corn so that they would be able to sell more each year.
• B)increase spending on fertilizer in an attempt to produce more corn on the acres they farm.
• C)reduce the number of acres on which they plant corn.
• D)contribute to a fund that promotes technological advances in corn production.

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Definitions:

Quantity of Money Demanded

The total amount of money that households and businesses in an economy want to hold at a given time, based on interest rates and economic activity.

Money Supply

The bulk sum of assets in monetary form within an economy at a particular moment.

Gross Domestic Product

The total value of all goods and services produced within a country's borders in a specific time period, used as a measure of economic performance.

Multiplier

The ratio of change in the aggregate output (or income) to the change in an initial injection of spending, demonstrating the ripple effect in the economy.