Asked by JENELLE POPELAS on Jun 16, 2024
Verified
If the demand for an agricultural product is inelastic, a bumper crop will
A) raise price and decrease total revenues.
B) raise price and increase total revenues.
C) lower price and decrease total revenues.
D) lower price and increase total revenues.
Price Elasticity
An indicator showing the reaction of consumer demand for a product to shifts in its price, illustrating how price fluctuations affect buyer sensitivity.
Bumper Crop
is an unusually large harvest of a crop, often due to favorable growing conditions.
- Assess the adaptability of demand for agricultural outputs and its effects on financial returns in farming.
Verified Answer
MK
Michael KieblesJun 21, 2024
Final Answer :
C
Explanation :
When demand is inelastic, a bumper crop (which increases supply) will lower the price, but because the demand does not increase proportionately (people don't buy much more just because it's cheaper), total revenues decrease.
Learning Objectives
- Assess the adaptability of demand for agricultural outputs and its effects on financial returns in farming.
Related questions
Which of the Following Statements Best Describes the Demand for ...
One Consequence of the Long-Run Problem Faced by Farms Has ...
An Extraordinarily Small Crop of Farm Products Due to Drought ...
Which of the Following Statements Is Correct ...
Because the Demand for Agricultural Products Is Highly Price Inelastic ...