Lillian says, "People do not care about genetically modified
(GM) food. A durian is a durian". Suppose that Lillian is correct
and durian buyers are unaffected by the introduction of GM durians.
(a) Explain, using an appropriate diagram, the effect of
introducing GM durian breeds on the equilibrium price and quantity
in the market for durian.
(b) Following the introduction of GM durian breeds, what will
happen to durian farmers’ revenue? Explain.
(Please explain in length as much as possible)
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