Suppose there are 6000 corn farmers in the u. s. each, Ask an Expert

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Suppose there are 6,000 corn farmers in the U. S. Each farmer has the usual U-shaped average cost curve. The market demand curve for corn slopes downward and the market for corn is perfectly competitive. Currently the market is in short-run equilibrium and each farmer is making positive economic profit at a market price of $6 per bushel.

Given that all corn farmers earns positive economic profits; in the long run, more farmers will enter to produce corn, the market price of corn will fall. As the market price of corn falls, each corn farmer ______ its production to maximize profits. When the market reaches the long-run equilibrium, we would expect each corn farmer to earn _____

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Macroeconomics, Economics

Category:- Macroeconomics
Reference No.:- M965982

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