Question

Question 1 1.5 pts The farm-level derived demand for inputs used in production are usually Tim Atter 0 M More price elastic than the retail-level demand. Less price elastic than the retail-level demand. Just as price elastic as the retail-level demand Not enough information to say D Question 2 1.5 pts The flexibility can be written as: The income elasticity of a product. The inverse of a sensitivity. The inverse of a price elasticity. The cross price elasticity of a product

Answer 1

Answer to question number 1 is less price elastic. This is because there are fewer substitute for inputs used by the production process. The price of the product can change the quantity demanded more strongly then it can change the input usage.

Answer to question number 2 is inverse of price elasticity because it measures how flexible the quantity demanded of a product is with the change in the price

Answer to question number 3 is negative. When the price of a product falls its quantity demanded increases and this also increases the quantity demanded of its complement. This indicates that the cross elasticity is negative.

Answer to question number 4 is less price elastic. Perishable goods have a short time period therefore sellers want to sell as much as they can immediately and they are willing to reduce the price by large amount.