This question was poorly attempted by candidates. In question 9(a)(i & ii), many
candidates could neither explain the law of diminishing returns nor state how the law
of diminishing returns affects agricultural production.
Also, in question 9(b), some of the candidates could not discuss how the following
factors affect supply of agricultural produce: (price; technology; weather; subsidy and government policy).
The expected answers include;
Explanation of the law of diminishing returns:
The law of diminishing returns states that as successive amounts of a variable factor are applied to one or more fixed factors, output will increase a lot at first but there comes a point at which the use of one more amount of the variable factor will add less to output than the preceding amount. That is the point where diminishing returns set in.
How the law of Diminishing Returns affect agricultural production:
It enables farmers to determine/know the optimum level of combination of factors
of production that will maximize output and profit.
How some factors affect the supply of agricultural produce:
Price:
- The higher the price of the produce, the greater will be the supply and vice versa.
Technology:
- The development of new method of production which brings about increased output at lower cost leads to increase in supply
- While the use of obsolete technology lowers production and thus reduces supply
Weather
- In good weather there is abundant rainfalls and sunshine which favour agricultural production
- While bad weather conditions such as drought, hurricanes etc. affect agricultural production and lowers supply
Subsidy:
- Subsidy which is a non-repayable grant given to farmers in kind or cash, helps to reduce the overall cost of production and encouraged the farmers to produce more
- Enables the farmers to acquire farm inputs at lower prices thus enabling them to increase their production and supply.
Government policy:
- Taxes on agricultural inputs by the government increase the cost of production and this will cause a reduction in the supply of farm produce and vice visa
- A ban on importation of competitive produce will encourage local production.
