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CA Foundation · Business Economics · Price Determination in Different Markets

Classification of markets on the basis of area of operation divides them into local, national and international markets. Which commodity is MOST likely to have a wide international market?

Gold is most likely to have an international market because it is durable, easily portable, high in value relative to weight and standardised in quality. Perishable or bulky goods like fresh milk, spinach and ice blocks cannot travel far economically, so their markets remain local.

  1. AFresh fluid milk
  2. BGoldCorrect
  3. CFresh vegetables such as spinach
  4. DIce blocks

Explanation

A wide market needs a commodity that is durable, portable, has high value for its weight, and is standardised. Gold meets these conditions. Milk, leafy vegetables and ice are perishable or bulky relative to value, so their markets stay local.

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