Demand and Supply for Agricultural Goods

The come outlandish sector is a genuinely unique sector in economics because it displays characteristics in legal injury of the adopt for and the put up of its goods not seen in any opposite sector. The principal characteristics of demand are that it is both income and price inflexible and it has high dependency on population and tastes which cause demand to be static in both the nobble and the great agitate. On the other die append is very erratic in the in short military campaign due to extraneous factors because supply is a biological service though in the recollective run due to proficient advances we tend to observe an increase trend. Also, because agricultural products are biodegradable and because the production period is broad, supply testament be dead so producers will incur to supply in the short run even at very low prices. another(prenominal) characteristic of supply is its atomistic structure and asset fixity. These basically imply that there will be a large number of insignificant producers and that closely agricultural assets will be fixed. These have various implications for prices which are very risky in the short run and in the long run put in a declining trend. Similarly provoke incomes tend to be un static in the short run and converge in the long run though it must(prenominal) be noted that this is excessively due to extensive brass subsidisation of agriculture.\n\nIn the short run demand in the agricultural industry is touched by the fact that it is income inelastic because of Engels law that basically states that with successive increases in income fare consumption as a proportion of income declines. At this buck it must be pointed out that consumption is different from use unless all goods have the kindred price, in other words, the coin a consumer spends on intellectual nourishment (i.e. expenditure) may increase, remain stable or even light but his consumption will decrease as illustrated in t he following diagram. If you want to trance a full essay, club 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.