article:The supply and demand factors affecting the farm level price for Irish potatoes have undergone considerable changes in the last two decades. On the demand side, per capita consumption has decreased by almost one half, and the use of potatoes has shifted due to changes in the preferences of consumers. Consumption of table stock and processed potatoes has shifted towards greater and other complementary products. On the supply side, domestic production levels of potatoes decreased by over 30 percent, while the number of potato farmers decreased by more than 75 percent over the same period. Against this background of significant changes in the domestic consumption levels, patterns and production of potatoes, this paper examines the effect of these factors on potato price levels and variability. Farm level price and volatility is a concern for several reasons, as it poses challenges for business planning, debt repayment, and, in some cases, solvency. Question 1 a) List the four determinants of demand and the four determinants of supply mentioned in the extract. b)Explain whether the volatility in the demand for potatoes constitutes a change in demand or a change in the quantity demanded. Thereafter, use a graph to explain the difference between a change in demand and a change in quantity demanded.
article:The
have undergone considerable changes in the last two decades. On the demand
side, per capita consumption has decreased by almost one half, and the use of
potatoes has shifted due to changes in the preferences of consumers.
Consumption of table stock and processed potatoes has shifted towards greater
and other complementary products. On the supply side, domestic production
levels of potatoes decreased by over 30 percent, while the number of potato
farmers decreased by more than 75 percent over the same period. Against this
background of significant changes in the domestic consumption levels, patterns
and production of potatoes, this paper examines the effect of these factors on
potato price levels and variability. Farm level price and volatility is a concern for
several reasons, as it poses challenges for business planning, debt repayment,
and, in some cases, solvency.
Question 1
a) List the four determinants of demand and the four determinants
of supply mentioned in the extract.
b)Explain whether the volatility in the demand for potatoes constitutes a
change in demand or a change in the quantity demanded. Thereafter,
use a graph to explain the difference between a change in demand and
a change in quantity demanded.
Trending now
This is a popular solution!
Step by step
Solved in 5 steps with 2 images
