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WAEC Economics 2021 Question 6

Question 6

Price Determination

An increase in the rice harvest, all things being equal, may cause

  1. A.price to increase substantially.
  2. B.price to fall substantially.
  3. C.demand to fall substantially.
  4. D.farmer's incomes to be more than doubled
Show the answer and explanation

Answer: B (price to fall substantially.)

Explanation

A bigger harvest increases supply, so the price falls.