Question

what is buffer stock............????

Answer 1

A buffer stock or an intervention storage is using commodity storage for stability of prices in an economy or market.

Explanation:

• This usually happens when a commodity is being bought in large quantities by the consumers, and some stocks are then stored and resold when there are shortages in the economy.
• In a buffer stock there are 2 lines – a floor and ceiling. When the price of a commodity drops to the floor level, the operator stocks up to ensure the price does not fall further.
• If it hits the ceiling, the commodity is depressed by selling off holdings.

Learn more:

1) Explain buffer stock in the light of reducing food insecurity in India:

https://brainly.in/question/7304470

2) How increase in buffer stock would help to avoid situations of drought and famines:

https://brainly.in/question/5843171

Answer 2

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Buffer stock us the stock mainly of wheat and rice procured by Food Corporation of India (FCI)...

This stock is used to distribute food grains in deficit areas and among poorer strata of society at a lower price than the market price..

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