Define the minimum support price
Answers
Minimum Support price is price at which government purchase crops from farmer at any rate . It is important to parts of india's agricultural price policy . The MSP helps to incentivice the farmers and ensures the adequate food grains production in country.
Answer:
1) Minimum Support Price is the price at which the farmer can sell their products government or others.
2) This is decided by government every year during reaping time by considering the cost of production and nominal profit of farmer.
3) Traders or government have to purchase agricultural products at this price or more.
4) MSP provides minimum guarantee to the value of crops and farmers can sell crops at more prices according to demand.
5) This prevent traders syndicate of reducing price.