The discovery of a new hybrid wheat would tend to increase the supply of wheat.Under what conditions would wheat farmers realise an increase in revenue?
A)if the supply of wheat is elastic
B)if the supply of wheat is inelastic
C)if the demand for wheat is inelastic
D)if the demand for wheat is elastic

Question

Quizplus · Accepted Answer

If the demand for wheat is elastic, the increase in supply due to the new hybrid wheat would lead to a decrease in the market price. However, if the demand for wheat is inelastic, the increase in supply would not lead to a significant decrease in price, and therefore wheat farmers could potentially realize an increase in revenue.

The Discovery of a New Hybrid Wheat Would Tend to Increase