Suppose that the corn market is perfectly competitive, and Beta is one of the many corn producers in the market.

1. Initially the corn market is in a long-run equilibrium. Draw a diagram for the corn market and a diagram for Beta to explain the long run equilibrium situation.
2. Beta discovers a method to significantly reduce both the fixed costs and the variable costs of corn production. How will this discovery affect Beta and the corn market in the short run? Explain with suitable diagrams for the corn market and Beta.
3. Describe what will happen at the corn market in the long run.