Need ASAP! Scenario 3: Drought in the Cornbelt with Lower Loan Rate After you submit your new payment calculations given the drought in the previous scenario, your Branch Chief says

Need ASAP! Scenario 3: Drought in the Cornbelt with Lower Loan Rate
After you submit your new payment calculations given the drought in the previous scenario, your Branch Chief says
that the Secretary wants to know if this "typical" corn farmer would be benefited in this drought situation if he set the
loan rate lower at $1.50 and how government payments would change. Make your new calculations assuming
everything is the same as in the previous scenario (with the drought) EXCEPT that the loan rate is now $1.50/bushel.
Put your new calculations in the table below.
Payments
Price Loss
Market
Total
Market price
LDP/MLG
Coverage
Revenue
Revenue
$5.24/bu
$3.33/bu
$1.94/bu
$1.27/bu
$0.00/bu
Your work:

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