{"id":94068,"date":"2025-06-01T12:02:53","date_gmt":"2025-06-01T12:02:53","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=94068"},"modified":"2025-06-01T12:02:53","modified_gmt":"2025-06-01T12:02:53","slug":"the-msps-are-fixed-at-incentive-level-to-fulfil-the-following-purpose","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/the-msps-are-fixed-at-incentive-level-to-fulfil-the-following-purpose\/","title":{"rendered":"The MSPs are fixed at incentive level, to fulfil the following purpose"},"content":{"rendered":"<p>The MSPs are fixed at incentive level, to fulfil the following purposes :<\/p>\n<ul>\n<li>1. to induce less investment by farmers in the farm sector.<\/li>\n<li>2. to motivate farmers to adopt improved crop production technologies.<\/li>\n<li>3. to enhance production and thereby farmers&#8217; income.<\/li>\n<\/ul>\n<p>Select the correct answer using the code given below :<\/p>\n<p>[amp_mcq option1=&#8221;1 and 2 only&#8221; option2=&#8221;2 and 3 only&#8221; option3=&#8221;1 and 3 only&#8221; option4=&#8221;1, 2 and 3&#8243; correct=&#8221;option2&#8243;]<\/p>\n<div class=\"psc-box-pyq-exam-year-detail\">\n<div class=\"pyq-exam\">\n<div class=\"psc-heading\">This question was previously asked in<\/div>\n<div class=\"psc-title line-ellipsis\">UPSC SO-Steno &#8211; 2018<\/div>\n<\/div>\n<div class=\"pyq-exam-psc-buttons\"><a href=\"\/pyq\/pyq-upsc-so-steno-2018.pdf\" target=\"_blank\" class=\"psc-pdf-button\" rel=\"noopener\">Download PDF<\/a><a href=\"\/pyq-upsc-so-steno-2018\" target=\"_blank\" class=\"psc-attempt-button\" rel=\"noopener\">Attempt Online<\/a><\/div>\n<\/div>\n<section id=\"pyq-correct-answer\">\nStatement 1 is incorrect. Minimum Support Prices (MSPs) are fixed at incentive levels specifically to *encourage* farmers to invest more in the farm sector by assuring them a minimum price for their produce, thereby reducing market risk. Statements 2 and 3 are correct. By ensuring a floor price, MSPs reduce the risk associated with adopting new technologies (like better seeds, fertilizers) that require higher initial investment. This motivates farmers to modernize agriculture, leading to increased production and potentially higher income, especially for farmers cultivating MSP-covered crops who can sell their produce at the guaranteed price.<br \/>\n<\/section>\n<section id=\"pyq-key-points\">\nMSPs aim to provide a price guarantee to farmers, reduce income volatility, encourage production of certain crops, and incentivize investment and technology adoption.<br \/>\n<\/section>\n<section id=\"pyq-additional-information\">\nMSPs are announced by the Government of India for certain crops based on recommendations from the Commission for Agricultural Costs and Prices (CACP). While intended to support farmers, the MSP system has also been criticized for creating market distortions, encouraging the production of specific crops (like rice and wheat) over others, impacting soil health, and contributing to procurement and storage challenges.<br \/>\n<\/section>\n","protected":false},"excerpt":{"rendered":"<p>The MSPs are fixed at incentive level, to fulfil the following purposes : 1. to induce less investment by farmers in the farm sector. 2. to motivate farmers to adopt improved crop production technologies. 3. to enhance production and thereby farmers&#8217; income. Select the correct answer using the code given below : [amp_mcq option1=&#8221;1 and &#8230; <\/p>\n<p class=\"read-more-container\"><a title=\"The MSPs are fixed at incentive level, to fulfil the following purpose\" class=\"read-more button\" href=\"https:\/\/exam.pscnotes.com\/mcq\/the-msps-are-fixed-at-incentive-level-to-fulfil-the-following-purpose\/#more-94068\">Detailed Solution<span class=\"screen-reader-text\">The MSPs are fixed at incentive level, to fulfil the following purpose<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1095],"tags":[1114,1379,1120],"class_list":["post-94068","post","type-post","status-publish","format-standard","hentry","category-upsc-so-steno","tag-1114","tag-agriculture-and-allied-sectors","tag-economic-development","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>The MSPs are fixed at incentive level, to fulfil the following purpose<\/title>\n<meta name=\"description\" content=\"Statement 1 is incorrect. Minimum Support Prices (MSPs) are fixed at incentive levels specifically to *encourage* farmers to invest more in the farm sector by assuring them a minimum price for their produce, thereby reducing market risk. Statements 2 and 3 are correct. By ensuring a floor price, MSPs reduce the risk associated with adopting new technologies (like better seeds, fertilizers) that require higher initial investment. This motivates farmers to modernize agriculture, leading to increased production and potentially higher income, especially for farmers cultivating MSP-covered crops who can sell their produce at the guaranteed price. MSPs aim to provide a price guarantee to farmers, reduce income volatility, encourage production of certain crops, and incentivize investment and technology adoption.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/the-msps-are-fixed-at-incentive-level-to-fulfil-the-following-purpose\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The MSPs are fixed at incentive level, to fulfil the following purpose\" \/>\n<meta property=\"og:description\" content=\"Statement 1 is incorrect. Minimum Support Prices (MSPs) are fixed at incentive levels specifically to *encourage* farmers to invest more in the farm sector by assuring them a minimum price for their produce, thereby reducing market risk. Statements 2 and 3 are correct. By ensuring a floor price, MSPs reduce the risk associated with adopting new technologies (like better seeds, fertilizers) that require higher initial investment. This motivates farmers to modernize agriculture, leading to increased production and potentially higher income, especially for farmers cultivating MSP-covered crops who can sell their produce at the guaranteed price. MSPs aim to provide a price guarantee to farmers, reduce income volatility, encourage production of certain crops, and incentivize investment and technology adoption.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/exam.pscnotes.com\/mcq\/the-msps-are-fixed-at-incentive-level-to-fulfil-the-following-purpose\/\" \/>\n<meta property=\"og:site_name\" content=\"MCQ and Quiz for Exams\" \/>\n<meta property=\"article:published_time\" content=\"2025-06-01T12:02:53+00:00\" \/>\n<meta name=\"author\" content=\"rawan239\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"rawan239\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"1 minute\" \/>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"The MSPs are fixed at incentive level, to fulfil the following purpose","description":"Statement 1 is incorrect. Minimum Support Prices (MSPs) are fixed at incentive levels specifically to *encourage* farmers to invest more in the farm sector by assuring them a minimum price for their produce, thereby reducing market risk. Statements 2 and 3 are correct. By ensuring a floor price, MSPs reduce the risk associated with adopting new technologies (like better seeds, fertilizers) that require higher initial investment. This motivates farmers to modernize agriculture, leading to increased production and potentially higher income, especially for farmers cultivating MSP-covered crops who can sell their produce at the guaranteed price. MSPs aim to provide a price guarantee to farmers, reduce income volatility, encourage production of certain crops, and incentivize investment and technology adoption.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/exam.pscnotes.com\/mcq\/the-msps-are-fixed-at-incentive-level-to-fulfil-the-following-purpose\/","og_locale":"en_US","og_type":"article","og_title":"The MSPs are fixed at incentive level, to fulfil the following purpose","og_description":"Statement 1 is incorrect. Minimum Support Prices (MSPs) are fixed at incentive levels specifically to *encourage* farmers to invest more in the farm sector by assuring them a minimum price for their produce, thereby reducing market risk. Statements 2 and 3 are correct. By ensuring a floor price, MSPs reduce the risk associated with adopting new technologies (like better seeds, fertilizers) that require higher initial investment. This motivates farmers to modernize agriculture, leading to increased production and potentially higher income, especially for farmers cultivating MSP-covered crops who can sell their produce at the guaranteed price. MSPs aim to provide a price guarantee to farmers, reduce income volatility, encourage production of certain crops, and incentivize investment and technology adoption.","og_url":"https:\/\/exam.pscnotes.com\/mcq\/the-msps-are-fixed-at-incentive-level-to-fulfil-the-following-purpose\/","og_site_name":"MCQ and Quiz for Exams","article_published_time":"2025-06-01T12:02:53+00:00","author":"rawan239","twitter_card":"summary_large_image","twitter_misc":{"Written by":"rawan239","Est. reading time":"1 minute"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/exam.pscnotes.com\/mcq\/the-msps-are-fixed-at-incentive-level-to-fulfil-the-following-purpose\/","url":"https:\/\/exam.pscnotes.com\/mcq\/the-msps-are-fixed-at-incentive-level-to-fulfil-the-following-purpose\/","name":"The MSPs are fixed at incentive level, to fulfil the following purpose","isPartOf":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#website"},"datePublished":"2025-06-01T12:02:53+00:00","dateModified":"2025-06-01T12:02:53+00:00","author":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209"},"description":"Statement 1 is incorrect. Minimum Support Prices (MSPs) are fixed at incentive levels specifically to *encourage* farmers to invest more in the farm sector by assuring them a minimum price for their produce, thereby reducing market risk. Statements 2 and 3 are correct. By ensuring a floor price, MSPs reduce the risk associated with adopting new technologies (like better seeds, fertilizers) that require higher initial investment. This motivates farmers to modernize agriculture, leading to increased production and potentially higher income, especially for farmers cultivating MSP-covered crops who can sell their produce at the guaranteed price. 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