Question

The agricultural market is often cited as an example of a competitive market.

1) Considering realistic conditions, if you insist that the rice market is not a completely competitive market, Explain and explain why.

2) Suppose that the agricultural market is a fully competitive market free of entry and exit, and that individual farmers are like companies in the general market. Then, why are only elderly people who are relatively incompetent in many ways, such as knowledge, information, and workforce remain on the agricultural field?

Answer 1

Agriculture market is called as a perfectly competitive market because here a large number of buyers and sellers are existing and all are selling almost the similar quality of a product.
Where the possibility of profit is normal in both the short run and in the long run because of the common goods in the market.
And here it is assumed that all the buyers and sellers have complete knowledge about the market and this is the only reason here price is constant and the demand curve is perfectly elastic.
In this case there is a situation of rice market which is commonly called as not a completely competitive market and this is the only reason because in rice there are various varieties and the prices of the rice totally depend on the prices of the commodities.
When a consumer is asking for a better quality product in rice then farmers are ready to charge a higher price in this market.
This is another case where elderly people who are relative Less incompetent in many ways such as knowledge information and workforce remain on the agricultural field when this market is treated as not a perfectly competitive market so as per the information elderly people are doing this thing from so many years and this is the only reason they know the productivity level in the agricultural field so the profit margin and the revolution ration in this market is not so good at it is relative Less changes by one or two percent in every year so this is the only reason why this people are staying in this market.