JAMB 2016 Economics · Question 41

One of the factors that determine the supply of agricultural produce in Nigeria is

Options

  1. A.Price of substitutes
  2. B.Technological development
  3. C.Consumers choice
  4. D.Consumers income

Answer: B. Technological development

Explanation written with AI and checked against the answer key

1. Analyze the question The question asks about a determinant of supply (what producers offer for sale), not demand (what consumers want to buy).

2. Explain the concept Factors affecting supply include:

  • Cost of production (wages, fertilizer, seeds)
  • State of technology
  • Weather and natural conditions (very important in agriculture)
  • Government policies (taxes, subsidies)
  • Prices of related goods
  • Number of producers

Factors affecting demand include consumers' income, tastes and choices, and prices of substitutes and complements.

3. Go through the options

  • A. Price of substitutes: This is mainly a determinant of demand. If the price of a substitute rises, consumers buy more of the other good. (Price of goods in competitive supply can affect supply, but "substitutes" is the standard demand-side term.)
  • B. Technological development: This is a supply factor. Better technology, such as improved seeds, tractors, and irrigation, lowers production costs and raises output, shifting the supply curve to the right.
  • C. Consumers' choice: This is about tastes and preferences, so it is a demand factor.
  • D. Consumers' income: This is a demand factor.

4. Answer Only option B affects the producer's side, so the correct answer is B. Technological development.

5. Exam tip Ask yourself, "Who is this factor about, the buyer or the seller?" If it mentions consumers, income, tastes, or substitutes, think demand. If it mentions production costs, technology, weather, taxes/subsidies, or number of firms, think supply.

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