Suppose that the quantity of corn supplied depends on the price of corn (_P_) and the amount of rainfall (_R_). The demand for corn depends on the price of corn and the level of disposable income (_I_). The equations describing the supply and demand relationships are _Q__s__ _= 20_R _+ 100_P _and _Q__d__ _= 4000 − 100_P _+ 10_I_. a) Sketch a graph of demand and supply curves. b) Sketch a graph that shows the effect of an _increase _in rainfall on the equilibrium price and quantity of corn. c) Sketch a graph of demand and supply curves that shows the effect of a _decrease _in disposable income on the equilibrium price and quantity of corn.

/in /by

Suppose that the quantity of corn supplied depends on the price of
corn (_P_) and the amount of rainfall (_R_). The demand for corn
depends on the price of corn and the level of disposable income (_I_).
The equations describing the supply and demand relationships are
_Q__s__ _= 20_R _+ 100_P _and _Q__d__ _= 4000 − 100_P _+ 10_I_.

a)     Sketch a graph of demand and supply curves.

b)     Sketch a graph that shows the effect of an _increase _in
rainfall on the equilibrium price and quantity of corn.

c) Sketch a graph of demand and supply curves that shows the effect of
a _decrease _in disposable income on the equilibrium price and
quantity of corn.

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