In 2007, dairy farmers faced an (equilibrium) wholesale price for their milk of about 1 cent per

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In 2007, dairy farmers faced an (equilibrium) wholesale price for their milk of about 1 cent per ounce. Because of changes in consumer preferences, the demand for milk has been declining steadily since then.

a. In the short run, what effect would this have on the price of milk? On the number of dairy farmers (and the size of dairy herds)? Explain.

b. What long-term prediction would you make for the price of milk?

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Managerial economics

ISBN: 978-1118041581

7th edition

Authors: william f. samuelson stephen g. marks

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Question Posted: Jan 30, 2013 01:09 AM

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In 2007, dairy farmers faced an (equilibrium) wholesale price for their milk of about 1 cent per

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a Depicting the market effect of declining milk demand means reversing the result sh...View the full answer

Managerial economics

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