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Explain the special characteristics of agricultural markets.
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Stephanie Merks Agricultural Markets a.) Explain the special characteristics of agricultural markets. (15) Agricultural markets are special types of markets that have special characteristics that differ from other markets. These are mainly due to factors affecting supply of agricultural products, and the situation of producers in this business. First of all the agricultural market is very competitive because the producers are all very small and large in number. Therefore, they don't have a great influence on the price of their products. Agricultural producers are what are known as price takers, producers that have little or no influence on the price of their output. The demand for individual producers is very price elastic. This is because they are in a competitive environment due to the large number of farmers. These producers are all competing for the same market and therefore when their prices rises slightly the quantity demanded for their products decreases significantly. This...
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