Ceteris paribus,if the corn crop is 15 percent larger this year than it was last year,farmers will have to ________ the price of corn by ________ to sell the new crop.
A)raise;more than 15 percent
B)reduce;more than 15 percent
C)reduce;less than 15 percent

Question

Quizplus · Accepted Answer

If the corn crop is 15 percent larger this year than it was last year, there will be an increase in supply of corn. As a result, to sell the new crop, farmers will have to reduce the price of corn by more than 15 percent to create a shift in demand and sell the new crop. Therefore, the best choice is B.

Ceteris Paribus,if the Corn Crop Is 15 Percent Larger This