How do the medium and large farmers obtain capital for farming? How is it different from the small farmers?
Answer to be written in the exam:
- From a portion of their yield, large and medium farmers sell excess agricultural products.
- A portion of the profits is set aside and used to purchase capital for the following season.
- A handful of them lend money to small farmers at high-interest rates and give away their savings in exchange for repayment by the following season.
- As a result, they can use their funds to arrange for the money needed for farming. Additionally, some farmers may decide to start up stores and purchase trucks or animals with their savings.