If the market elasticity of demand for potatoes is -0.3 in a perfectly competitive market, then the individual farmer's elasticity of demand
A)will also be -0.3.
B)depends on how large a crop the farmer produces.
C)will range between -0.3 and -1.0.
D)will be infinite.

Question

Quizplus · Accepted Answer

In a perfectly competitive market, individual farmers are price takers, meaning they can sell any quantity of their product at the market price. Therefore, the elasticity of demand for an individual farmer is infinite, as they can sell as much as they want at the market price without affecting it.

If the Market Elasticity of Demand for Potatoes Is -0