Asked by Sarah Dinek on May 09, 2024
Verified
The market for soybeans is initially in equilibrium,with an upward-sloping supply curve and a downward-sloping demand curve.Because of mad cow disease,producers decide to replace bone meal with soybeans in cattle feed.The likely effect is that the:
A) equilibrium price and quantity of soybeans will rise.
B) equilibrium price and quantity of soybeans will fall.
C) equilibrium quantity of soybeans will rise,but we can't determine what will happen to the equilibrium price.
D) equilibrium price of soybeans will rise,but we can't determine what will happen to the equilibrium quantity.
Soybeans
A type of legume native to East Asia, widely grown for its edible bean which has numerous uses, including oil and protein sources.
Mad Cow Disease
A fatal brain disease in cattle that can potentially be transmitted to humans who consume tainted beef, scientifically known as Bovine Spongiform Encephalopathy (BSE).
- Examine the influence of external elements on the behavior of supply and demand curves.
- Forecast the effects on market results from changes in supply and demand.
Verified Answer
SN
Shauna NadeauMay 15, 2024
Final Answer :
A
Explanation :
The shift in demand for soybeans from the cattle industry will cause the demand curve for soybeans to shift to the right, leading to an increase in both the equilibrium price and quantity of soybeans.
Learning Objectives
- Examine the influence of external elements on the behavior of supply and demand curves.
- Forecast the effects on market results from changes in supply and demand.