a) Assume that the US has monopoly power as a country in the international market for corn. In a diagram, show the residual demand for US corn (where residual demand = World Demand - Work supplies excluding the US). Show the supply curve for US corn farmers, assuming they are price takers as individual farmers. Clearly show the optimal (joint profit maximizing) price and quantity to set for this corn if you were the American Corn board, an exporting monopoly. Show the price and quantity that occurs if the monopoly is ended and if the American corn farmers now sell their corn individually (ignore transaction costs)

b) Next, make another diagram showing a typical individual US corn former's demand and costs (assume the farmer is a price taker).

Show the output the farmer chooses when the monopoly is gone (assume this is a point of long run equilibrium).

Show the output the farmer would have wanted to produce and sell when the monopoly price was in place. What would happen to the price obtained by Canadian farmers, if every farmer actually tried to sell this amount?