Technological improvements in agriculture that shift the supply of agricultural commodities to the right tend to
A) increase total revenue to farmers as a whole because the demand for food is elastic.
B) increase total revenue to farmers as a whole because the demand for food is inelastic.
C) reduce total revenue to farmers as a whole because the demand for food is elastic.
D) reduce total revenue to farmers as a whole because the demand for food is inelastic.

Question

Quizplus · Accepted Answer

When supply increases, prices tend to fall. If demand is inelastic, the percentage drop in price is greater than the percentage increase in quantity sold, leading to a decrease in total revenue.

Technological Improvements in Agriculture That Shift the Supply of Agricultural