question archive What implications does the nature of the supply of agricultural products have for own-price elasticity of supply of agricultural products?
What implications does the nature of the supply of agricultural products have for own-price elasticity of supply of agricultural products?
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What implications does the nature of the supply of agricultural products have for own-price elasticity of supply of agricultural products?
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Agricultural products show price inelasticity of supply because the supply of the product is not highly responsive to the change in the price.
1. When the price increases, the supply of agricultural product cannot be increased because of the natural limitation of the production cycle and productive capacity.
2. When the price falls, the supply does not fall as the farmers cannot keep the agricultural products for long because of it's perishable nature.
