Question

A drought around the world reduces the total revenue that farmers receive from the sale of grain if demand is inelastic Why would a drought only in Kansas most likely reduce the total revenues that Kansas farmers receive? elastic A drought in Kansas would significantly lower the worldwide price of grain. A drought in Kansas would significantly raise the worldwide price of grain. A drought in Kansas is not significant enough to affect the worldwide price of grain.

Answer 1

Answer:

The correct answer is letter "C": A drought in Kansas is not significant enough to affect the worldwide price of grain.

Explanation:

In case a drought affects only the farms in Kansas, there will be less supply of grains growing in Kansas but customers may ask for the grains from other regions not affected by the drought. Therefore, Kansas farmers' profits will be decreased but it will not affect the worldwide price of grains.