This preview has intentionally blurred sections. Sign up to view the full version.View Full Document
Unformatted text preview: Jeremy Doncouse ECON202 Key Questions Chapter 31 11/22/2008 1) Because of the inelasticity of demand for farm products, a relatively small change in farm output will cause a relatively large change in agricultural prices. Because of the highly inelastic demand for farm products, a small shift in demand for farm products can drastically alter agricultural prices and farm income, given a fixed level of production. Exports increase the instability of demand for farm products because of international politics and changes in the international value of the dollar. 3) a. A relatively small change in farm output will cause a relatively large change in agricultural prices. b. The supply of farm products has increased rapidly because of technological progress. The demand for farm products has increased slowly, because it is inelastic with respect to income. c. In the long run, increases in the demand for U.S. farm products have not kept pace with the increases in supply resulting from technologicalc....
View Full Document
This note was uploaded on 03/08/2011 for the course ECON 202 taught by Professor Unknown during the Fall '08 term at Mountain State.
- Fall '08