Question

How does small farmers obtain capital for farming ? What is its consequence ? Explain

Answer 1

Small farmers are the farmers who invest a little in their farms and have usually smaller farms as compared to other farms.

Small farmers usually get their capital by borrowing from big farmers or sometimes from money lenders too in order to buy equipment they need for their farms or for cultivation.

The consequence for borrowing money from big farmers is that the rate of interest is really high so when they have to repay the loan it puts them in a great debt and distress while paying the loans.