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If the world price of wheat increases due to bad weather in Europe, Russia and South America, __________.

Corn farmers in the US and Canada may decide to produce wheat instead of Corn.

Corn farmers in the US may decide to reduce wheat production.

Bread prices will decrease.

That may lead to an increase in chewing gum production.

1 answer

If the world price of wheat increases due to bad weather in Europe, Russia, and South America, corn farmers in the US and Canada may decide to produce wheat instead of corn.

This response reflects the economic principle of opportunity cost, where farmers might shift their production to a more lucrative crop (wheat in this case) due to the increased prices. The other options do not logically follow from the scenario provided.