Suppose That the Market for Corn Is Initially in Equilibrium

question 29

Multiple Choice

Suppose that the market for corn is initially in equilibrium and is perfectly competitive.The demand curve can be expressed as ; the supply curve can be expressed as Quantity is expressed in millions of bushels.Now suppose that the federal government imposes a price floor of $3 per bushel of corn.Which of the following best describes the market after the price floor is imposed?

• A) There will be a shortage of 5 million bushels.
• B) There will be a surplus of 5 million bushels.
• C) There will be a surplus of 7 million bushels.
• D) There will be a surplus of 12 million bushels.

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Definitions:

Open-door Policy

A management practice that encourages open communication and accessibility between employees and senior management.

Suggestion Systems

Formal methods of generating, evaluating, and implementing employee ideas.

Upward Systems

Organizational mechanisms that facilitate the flow of information from lower levels of a hierarchy to upper levels, often used for feedback, suggestions, and reporting issues.

Downward Systems

Communication channels that convey information and directives from higher levels of an organization to its lower levels.