As the supply of tomatoes increases in your local mandi, its price drops. When the local harvest starts reaching the market, the price of tomatoes drops from Rs. 40 per kg to Rs 4 per kg or even less. Is there any relationship between two variables?

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Anuj Kumar Sinha

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The fall in price of tomatoes when the local harvest starts reaching the market is due to following two readons: 1. When supply is in much excess of demand , as per basic theory of economics the price of commodity, here tomatoes , falls. 2. Tomatoes are perishable. They can't be preserved for longer...
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The fall in price of tomatoes when the local harvest starts reaching the market is due to following two readons: 1. When supply is in much excess of demand , as per basic theory of economics the price of commodity, here tomatoes , falls. 2. Tomatoes are perishable. They can't be preserved for longer time by all the farmers as all of them do not have storage facility. Hence tomato growers are compelled to sell them off so price comes down. read less
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Teacher

It's very simple demand and supply relationship as supply increase the price will decrease as demand remains more or less same.
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Tutor

Yes there is relation between these two variables. The relation can be observed in two ways. One is Effect of price on its supply and the other is effect supply on its price. EFFECT OF PRICE ON ITS SUPPLY: Other things being contact, when price increases, the supply expands and when the price decreses,...
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Yes there is relation between these two variables. The relation can be observed in two ways. One is Effect of price on its supply and the other is effect supply on its price. EFFECT OF PRICE ON ITS SUPPLY: Other things being contact, when price increases, the supply expands and when the price decreses, there is contraction in supply. EFFECT OF SUPPLY ON ITS PRICE: Other things including price being constant, if Supply of a comodity increases and exceeds demand, then price declines, but when the supply decreases and defeated by demand, then price goes up due to demand being more than supply. read less
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Economist

There is the negative relationship between price and supply of tomatos due to excess supply of tomatos.
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Considering all other variables constant, supply and price have an inverse relationship. If you plot a graph, taking the same values that you have mentioned here, you can see it for yourself. This is again considering that the demand has remained constant and it has not changed due to additional people...
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Considering all other variables constant, supply and price have an inverse relationship. If you plot a graph, taking the same values that you have mentioned here, you can see it for yourself. This is again considering that the demand has remained constant and it has not changed due to additional people or unavailability of substitutes, to be clear. Hope this answers your query. read less
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