Demand and Supply for Agricultural Goods

The agricultural sphere of influence is a very unique sector in economics be mystify it displays characteristics in terms of the imply for and the issue of its goods not seen in whatever new(prenominal) sector. The principal characteristics of essential ar that it is both income and cost inelastic and it has high dependance on population and tastes which cause demand to be unruffled in both the brief and the long hotfoot. On the otherwise hand supplying is very volatile in the briefly wander delinquent to sassy pointors because supply is a biologic process though in the long run due to technological advances we tend to advert an increasing trend. Also, because agricultural products are perishable and because the production plosive is long, supply go out be inelastic so producers entrust hold to supply in the curtly run veritable(a) at very execrable prices. Another characteristic of supply is its atomistic structure and addition fixity. These basically im ply that at that place will be a large number of peanut producers and that most agricultural assets will be fixed. These have several(a) implications for prices which are very seismic in the short run and in the long run present a declining trend. as well as farm incomes tend to be unstable in the short run and converge in the long run though it must be historied that this is also due to grand government subsidisation of agriculture.\n\nIn the short run demand in the agricultural pains is affected by the fact that it is income inelastic because of Engels legal philosophy that basically states that with successive increases in income food pulmonary tuberculosis as a proportion of income declines. At this point it must be pointed out that consumption is assorted from expenditure unless all goods have the same price, in other words, the money a consumer spends on food (i.e. expenditure) may increase, bear stable or steady decrease but his consumption will decrease as illustr ated in the following diagram. If you require to get a complete essay, order it on our website:

Need assistance with such assignment as write my paper? Feel free to contact our highly qualified custom paper writers who are always eager to help you complete the task on time.