Asked by logan brockway on Jul 14, 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
Describes a situation where the demand or supply of a good is not significantly affected by changes in price.
Supply
The total amount of a good or service that is available to consumers.
Farm Prices
The amount of money that farmers receive for their products, which can fluctuate based on supply, demand, and external factors.
- Determine the impact of market forces on prices in agriculture and income from farming.
- Understand the importance of price elasticity within the agricultural sector.
Verified Answer
RM
Ra-ees ManuelJul 18, 2024
Final Answer :
True
Explanation :
When demand is inelastic, consumers do not significantly increase their quantity demanded in response to a price decrease. Therefore, a small increase in supply can lead to a larger percentage decrease in price, reducing farm incomes.
Learning Objectives
- Determine the impact of market forces on prices in agriculture and income from farming.
- Understand the importance of price elasticity within the agricultural sector.
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