PRC-3 · Chapter 11 · Question 26 of 57
Why is the supply of fresh, perishable agricultural goods (like ripe tomatoes) generally highly inelastic in the very short run (e.g., market day)?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Because the goods must be sold immediately before they rot, regardless of price drops
Explanation
Perishable goods cannot be withheld from the market and stored for later when prices improve. They must be sold immediately, making short-run supply very inelastic.
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