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Which of the following factors/ policies were affecting the price of rice in India in the recent past?

1. Minimum support prices
2. Government trading
3. Government stockpiling
4. Consumer subsidies

Select the correct answer using the code given below :

(a) 1, 2 and 4 only
(b) 1,3 and 4 only
(c) 2 and 3 only
(d) 1, 2, 3 and 4



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1. Minimum support prices (MSP): The government sets minimum support prices for various agricultural commodities, including rice. These prices act as a floor price and provide a safety net for farmers, ensuring them a minimum income for their produce. MSPs can impact the market price of rice.

2. Government trading: The government engages in trading activities in the rice market, including procurement and distribution. Government trading can influence the demand and supply dynamics of rice, which in turn affects its price.

3. Government stockpiling: The government maintains strategic reserves of rice through stockpiling. When the government procures and stores large quantities of rice, it can impact the overall supply in the market, which can have implications for price stability.

4. Consumer subsidies: The government provides subsidies to consumers for rice through various schemes, such as the Public Distribution System (PDS). These subsidies aim to make rice affordable for the general population. Subsidies can influence the effective price of rice for consumers.


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