JAMB Economics 2019 Objective — Question 31
Question 31 of 40 from the Joint Admissions and Matriculation Board (JAMB) Economics 2019 Objective paper, with the correct answer and a full explanation.
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Farmers' income from cash crop exports may fall if they increase the volume of exports because
- A. foreign (importing countries') demand for the cash crop is inelasticCorrect
- B. the price of domestic goods will rise
- C. export duties are reduced
- D. local demand for cash crops increases
Explanation
An increase in the exports of cash crops may lead to a surplus, which results in a fall in price and farmer income, because the demand for their exports is inelastic.
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