Social Science (087) — AI-generated practice question

A small farmer like Shyamal borrows from an agricultural trader at 3% per month (36% per annum). The terms of credit include:

• Farm inputs (seeds, fertilisers) are supplied on credit at the start of the cropping season.
• Repayment is due after harvest.
• The farmer must promise to sell the crop to the trader (tied credit).

How this benefits the trader:
The trader ensures prompt repayment through the crop sale condition. Since crop prices are low right after harvest, the trader buys the crop cheaply and sells it later at a higher price, earning a double profit — on the loan (interest) and on the crop trade.

Source: Chapter 3 — Money and Credit, "Example of a Village" section

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The examiner expects three elements: the interest rate, the condition of supplying inputs on credit, and the compulsory crop-sale clause. Then 1–2 lines on how the trader profits from both interest and low crop prices. Avoid confusing Shyamal's trader loan (3%/month) with the moneylender rate (5%/month) — both appear in the passage, so be precise.