Question
Asked Oct 7, 2019

Suppose the price elasticity of demand for farm products is elastic. If federal government wants to follow a policy of increasing income for farmers, what type of programs will the government enact?

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Step 1

The price elasticity can be measured as the percentage change in quantity demanded due to percentage change in own price of a commodity.

If the demand for farm products is price elastic, this means that a small variation in the price of a good can lead to a large change in its quantity demanded.

Step 2

Farmers play a very important role in every economy as they fulfill the basic needs of every society, i.e., they provi...

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