<p>^That’s what I thought.</p>
<p>Ya that’s what I thought as well.</p>
<p>got the last two parts of FRQ 3 wrong (i was stupid), but feeling confident on the rest, like 40/60 at least on MC and the rest of the FRQ right. Still qualifies for a 5?</p>
<p>Oh okay that’s good. For the first one, I don’t know how good my explanations for 2 and 4 are, second one I bombed, third one I got all right. Hopefully a 4 or 5!</p>
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<p>The demand curve for the market does NOT shift rightward. There is not a determinant of demand that is affected when the demand of ethanol increases. People’s taste for corn remains the same, income & expected price are constant, no new buyers enter the market, and the problem does not say that corn and ethanol are related goods.</p>
<p>Instead, when corn is used as an input for ethanol, and the demand for ethanol increases (increasing the market clearing price for ethanol), the number of suppliers for corn will decrease because goods that can be produced with the same resources is a determinant of supply. Consequently, the equilibrium price of corn increases, and the equilibrium output of corn decreases.</p>
<p>C. II) Increase demand for ethanol shifts the supply curve in the corn market leftward, increasing the market price of causing Farmer Roy’s demand curve to shift upward and for Farmer Roy to produce more.</p>
<ol>
<li>D) Since corn is an input in the production of cereal, and the market price of corn has increased, a resource cost in cereal production has increased causing the market curve for the cereal market to shift to the left. This leftward shift causes equilibrium price of the cereal market to increase, and the equilibrium quantity to decrease.</li>
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<p>Demand for corn definitely shifts to the right… if more people are willing to pay for ethanol, than the MRP of corn rises, shifting its demand curve to the right.</p>
<p>OMG at the Form B questions for both Micro and Macro…so easy! I would have cried tears of joy if I had gotten those. Usually Form B Economics are torturous, but this year they seem like cakewalks.</p>
<h1>3 was extremely easy</h1>
<p>i wish we got game theory</p>
<p>What if on my graph for number 2, for the individual firm, I labeled the downward sloping line as MRP and the horizontal line as MRC. For the market, I labeled the downward sloping line as MRP and the upward sloping line as MRC.</p>
<p>widly: The question did not ask about corn used as food, but just corn in general. The supply curve for corn used as a food does in fact decrease, but the demand for corn in general does increase due to the increase in the demand for ethanol.</p>
<p>I self studied (not really because I never got around to reading the book) and totally failed. Ill be satisfied with a 2, happy with a 3, shocked with a 4, and (words cannot describe the impossible) with a 5.</p>
<p>So does anyone else have any input about the answers to these FRQs? Motion1234’s answers seem to match mine for the most part and they make sense, so I’m hoping they are the right ones.</p>
<p>@cavsfan-if more people are willing to pay for ethanol, and also equilibrium quantity will increase because of increased demand, the MRP of labor does in fact increase. If MRP increase, then more labor will be hired because a rationale firm will hire until MRP=MFC. Increasing labor means that more ethanol will be produced. To produce more ethanol, it comes of the expense of utilizing more corn, so that quantity supplied can satisfy the quantity demanded. It is the basic economic concept that resources are scarce, thus if the ethanol market has to increase output, it must use more input–i.e. corn–thus reducing the amount of corn available in the corn market.</p>
<p>@motion1234-I am unaware of anything in my post that led you to believe that I was specifically addressing corn used as food. If I did, I apologize for that. But I still hold that your argument is unsupported because you have not told me a specific determinant of demand that is affected by an increase in the demand for ethanol. When you were discussing derived demand, I think there was an error in your logic because an increase in ethanol would cause an increase in the demand for labor because MRP has increased. Derived Demand is commonly associated with labor. Since corn is neither a complement nor a supplement to ethanol, there would be no effect on demand in the corn market because of a price change.</p>
<p>@motion1234 & cavsfan-My objective was not to write incessantly like a high schooler who could not handle the fact that I may have gotten something wrong on the AP exam, I just wanted to know a specific economic justification as to how you guys determined that demand was affected as oppose to supply. I hope that my reply does not offend either of you.</p>
<p>I think it’s that an increased demand for ethanol causes the price of ethanol to rise.</p>
<p>Therefore, the possible revenue from selling corn rises, so the MRP rises, which also increases the demand for corn, which is like an input for ethanol.</p>
<p>Considering corn is in a perfectly competitive market, there is an unlimited amount, in theory, available, so both price and quantity should rise. (Think about it; if supply decreased, that would have meant that corn growers would have exited the market due to an increase in price, which makes no sense.) This would cause more corn growers to enter in the long run, which wasn’t asked on the exam.</p>
<p>So, if I accidentally put MR instead of MRP, will I lose all the points for the graph or just one? It’s still the same graph, right?</p>
<p>For the corn one? If so, I don’t think so. I just put D=MR=AR=$. I was just mentioning MRP to illustrate why the demand would increase.</p>
<p>I know it’s been asked before, but this is the exam I have the most worries about. When does the College Board release the scoring guidelines?</p>
<p>bump 10char</p>
<p>A teacher site with unofficial scoring guidelinesis here:</p>
<p><a href=“http://tw.neisd.net/webpages/dmayer/files/2010%20AP%20Econ%20FRQs%201.pdf[/url]”>http://tw.neisd.net/webpages/dmayer/files/2010%20AP%20Econ%20FRQs%201.pdf</a></p>
<p>My computer struggled a bit with the Helvetica font, but it has macro and micro suggested scoring guidelines.</p>
<p>^Thanks for the link</p>