Farmers who sell agricultural products are like wheat and wool are price takers

Marketing Jan 12, 2021

Farmers who sell agricultural products are like wheat and wool are price takers. That is, they sell their priduce at the market price. What happens to the suppy of wheat when the Market prie falls? Why?

Expert Solution

Economic Principle of Law of Supply and Demand states that the Price Equilibrium falls when the supply of a certain goods increases but the demands for the same decreases. Hence, it is logical to assume on this problem that the market price (price equilibrium) falls due to increased supply of wheat but a lower demand for the same.

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