Glyphosate is the active ingredient in the herbicide Roundup marketed by Monsanto Co. Roundup has been a dependable product used by farmers, municipalities, and suburbanites alike to control weeds in fields, yards, gardens, streets, and parks. Contributions to Monsanto's revenue have been reduced significantly by international dumping of generic glyphosate, as announced in mid-2010. Monsanto's sales price was decreased from $16 to $12 per gallon to compete with the highly competitive pricing, and it is expected that the international price will settle at approximately $10 per gallon. Assume when the price was set at $16 per gallon, there was a prediction that in 5 years the price would inflate to $19 per gallon. Perform the following analysis. (a) Determine the annual rate of inflation over 5 years to increase the price from $16 to $19. (b) Using the same annual rate determined above as the rate at which the price continues to decline from the new $12 price, calculate the expected price in 5 years. Compare this result with $10 per gallon that Monsanto predicted would be the longer-term price. (c) Provided Monsanto were somehow able to recover the same market share as it had previ- ously, and the same inflation rate was applied to the reduced $12 per gallon price, deter- mine the price 5 years in the future and compare it with the pre-dumping price of $16 per gallon. (d) Determine the market interest rate that must be used in economic equivalence computations, if inflation is considered and an 8% per year real return is expected by Monsanto. tivate Wi Go to PC settin 48