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Unformatted text preview: // Please use this as a reference and compile your own answer with its help // Best regards // // Honest Abe // 1] If the demand for corn increases due to its use as an alternative energy source, what will happen to the supply of corn's substitute such as soybean? Explain, in economic terms, why this is so. Supply of corns substitute like soybean will decrease if the demand for corn increases as an alternative source of energy. This will be due to the fact that increase in demand of corn will cause its prices to rise. So farmers producing corn substitutes like soybean will start producing corn instead, on their land. They will make more profit from corns high prices. Thus soybean will be produced lesser and its supply will fall.  What will happen to the price of corn oil? Corn oil price will rise due to above because more corn will be used for production of...
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- Spring '10