The combination of income elasticity of demand for food and high agricultural productivity leads to the demand for food increasing and the supply of food increasing even more,which has lead to rising prices of food.

Question

Quizplus · Accepted Answer

The statement is incorrect. If the income elasticity of demand for food is high, it means that as incomes rise, the demand for food also increases. However, if agricultural productivity is also high, then the supply of food can increase to meet the rising demand, which can offset the price increase. Additionally, other factors such as trade, climate, and government policies can also affect food prices.

The Combination of Income Elasticity of Demand for Food and High