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- Subject
- Marketeconomics-mcqs › market
- Published
- 31 May 2019
- Last updated
- 28 May 2026
Why do agricultural prices often experience significant fluctuations?
Multiple choice question for Market. Select an option, then review the explanation below.
Explanation
Agricultural prices are prone to volatility primarily because both demand and supply are relatively unresponsive to price changes, meaning they are price inelastic. This inelasticity causes even small shifts in supply or demand to result in large price swings.
More Market MCQs
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- 2.Which of the following is a classic example of a public good?
- 3.Which of the following factors can lead to market failure?
- 4.When a neighbor burns yard debris and smoke enters your home, what type of externality does this represent?
- 5.Why is a competitive equilibrium considered Pareto efficient?