The demand for agricultural output is price inelastic.This means that if farmers,taken collectively,have a bumper crop,they will have _____ prices,_____ quantities sold,and _____ incomes.
A)lower;greater;lower
B)lower;greater;higher
C)lower;lower;lower
D)higher;higher;higher

Question

Quizplus · Accepted Answer

The demand for agricultural output is price inelastic, which means that changes in supply will have a relatively smaller effect on price. Therefore, if farmers have a bumper crop and increase the supply of agricultural output, prices will go down (lower prices). However, since the demand is inelastic, quantity demanded will not increase proportionally, resulting in greater quantities sold. This would lead to a decrease in farmers' incomes (lower incomes) due to the decrease in prices. Therefore, option A is the best choice.

The Demand for Agricultural Output Is Price Inelastic