1. Agricultural production is highly competitive for most commodities. Potatoes are no exception: price is determined by demand and supply. Based on statistics from the USDA, demand for table potatoes in the US is estimated to be: \[ Q_{D}=184-20 P \] where

The market demand and supply functions for potatoes are:QD = 2,000 - 500P and QS = 800 + 100P.To help potato producers, the government is considering legislation that would put a pricefloor at R2.25 per bag. If this price floor is implemented, determine (i) how many bags ofpotatoes will the government be forced to buy to keep the price at R2.25; (ii) how muchgovernment will spend in total; and (iii) how much producer- and consumer -surplus changes

Which of the following scenarios would likely shift the supply curve for potatoes to the right (increase in supply)?multiple choiceTeenagers in potato-farming towns leave to go to college.The price of fertilizer increases.Potato growers expect the price of potatoes to be lower this year than last year.A new harvester enables farmers to bring in ripe potatoes twice as fast as they did before.

Multiple Select QuestionSelect all that applyWhich of the following statements are true in industrially advanced economies?Multiple select question.The price elasticity of demand for agricultural products is low.The cross-price elasticity of demand for agricultural products is low.A large drop in the price of farm products yields only a small increase in consumer purchasing.The price elasticity of supply for agricultural products is negative.

Outline why the change in the market for processing potatoes identified in part (b) islikely to affect the market for frozen fries

The causes for price and income instability in the agricultural industry includeMultiple select question.an inelastic demand for agricultural products.increases in demand.an elastic demand for agricultural products.stable farm output.fluctuations in farm output.decreases in demand.