Given that the supply and demand for primary commodities are highly price inelastic, how do their prices typically behave?

Show Answers

They have consistently increased over the past several decadesThey remain more constant compared to the prices of manufactured itemsThey vary roughly the same amount as the prices of manufactured productsThey usually experience significant volatility from one year to the next

Explanation

Because both supply and demand for primary products respond little to price changes, their prices tend to show considerable instability on an annual basis, unlike the relatively steadier prices of manufactured goods.