Asked by Abena Opoku on Apr 29, 2024
Verified
If the demand for agricultural products is inelastic,a relatively small increase in supply will cause farm prices and incomes to decline.
Inelastic Demand
A market situation where the quantity demanded of a good or service changes very little with a change in its price.
Agricultural Products
Physical goods produced through farming or the broader agricultural sector, including both food items and raw materials.
- Study the influence of agricultural policies on market values, levels of output, and the division of economic gains within the agricultural community.
- Comprehend the interplay between supply and demand of agricultural goods and its effects on pricing and income levels.
Verified Answer
ZK
Zybrea KnightMay 04, 2024
Final Answer :
True
Explanation :
When demand for agricultural products is inelastic, it means that changes in supply have a greater impact on price than on quantity demanded. Therefore, a relatively small increase in supply will not result in a proportional increase in quantity demanded, causing farm prices and incomes to decline as a result.
Learning Objectives
- Study the influence of agricultural policies on market values, levels of output, and the division of economic gains within the agricultural community.
- Comprehend the interplay between supply and demand of agricultural goods and its effects on pricing and income levels.
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