Math, asked by Anonymous, 11 months ago

different problem associated with minimum support price

Answers

Answered by yashpare711

Market distortion:

It distorts the free market. It favours some particular crops over other crops. Not all farmers have been able to get the benefits of MSP because of lack of awareness.

Higher MSP over-incentivise production leading to supply glut.

Answered by jainsuchitra2006

Answer:

Minimum support price (MSP) is the rate at which government buys grains from the farmers. Reason with the idea of MSP is to counter price volatility of agricultural commodities sue to the factors like variation in their supply, lack of market integration and information asymmetry.

Not all farmers are able to get their benefits. Also it benefits of only in some crops and not the other.

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