Read carefully and answer details please. no hand writing as well. I will check and send back if something is wrong.

J L 1. (10 points) Ethanol is a fuel that is produced from corn. Ethanol can be used as a fuel in certain types of cars and some varieties of gasoline have ethanol blended in them. Producing corn for ethanol has become very popular over the last 20 years since it is very protable. In many parts of the country there are government mandates for blending ethanol into the gasoline that is sold by gas stations. This has led to an increased production of ethanol and therefore the use of corn to produce ethanol. Ethanol producers are willing to pay higher prices for corn than consumers of corn for food. If corn is used for producing ethanol, it cannot be used as food. What impact has this had on the supply of com for the food industry and the price of corn for food? Please explain and show the changes on a demand-supply graph for the corn for food industry. Your graph must show any shift of the curves that occurs and explain why that shi occurred. 2. (10 points) (a) As long as a prescription drug is under patent, the company has a monopoly, and no one can copy the drug. When the patent expires, generic manufacturers can copy the drug legally. What impact does the patent expiry have on the price elasticity of demand for the drug? Please give an explanation. (b) When the price of butter was "low," consumers spent $5 billion annually on its consumption. When the price doubled, consumer expenditures increased to $T billion. Is demand for butter elastic or inelastic? Please explain. 3. (10 points) Executives at Leonesse Cellars, a premium winery in Southern California, were surprised to learn that shipping wine by sea to some cities in Asia was less expensive than sending it to the East Coast of the United States by road, so they started shipping to Asia. Because of the large U.S. trade decit with major Asian countries, cargo ships from Asian countries arrive at West Coast ports fully loaded but return half to completely empty. Use the concept of opportunity cost to help explain why shipping to Asian cities on these cargo ships ramming to those cities would be cheaper than shipping by land to the East Coast of the United States. You must give an explanation