The Following Question Are Based on the Following Graph

question 6

Multiple Choice

The following question are based on the following graph. The curves D and S represent the market demand and supply curves for farm products in 1960. The curves D₁ and S₁ represent the market demand and supply curves for farm products in 2000. It is supposed that there were no support programs in either year.

-The relatively large shift in the supply curve over the 40 years illustrates that

• A) the quantity of food demanded does not vary much with the price of food because food is a necessity.
• B) consumption of food per capita faces natural limits and hence responds by only a small amount to changes in per capita income.
• C) farmers have only limited control over their outputs.
• D) there has been rapid technological change in agriculture.
• E) poor climatological conditions led to decreasing harvests.

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Definitions:

Inventory Turnover

A ratio showing how many times a company's inventory is sold and replaced over a specific period, indicating its efficiency in managing and selling stock.

Liquidity

The ease with which an asset can be converted into cash without significantly affecting its market price.

Days In Inventory

A financial metric that indicates the average number of days a company takes to turn its inventory into sales.

Credit Sales

Sales made by a business where the payment is delayed as per an agreement between the buyer and the seller.