question
Selling through a farmers' market or roadside market is known as
answer
Direct Marketing
question
The relationship between quantity purchased and price is known as
answer
Demand
question
The relationship between quantity supplied and price is known as
answer
Supply Curve
question
Price movement across months within the year is
answer
Seasonal Variability
question
The demand for a product at the farm level is a
answer
Derived Demand
question
The price where demand and supply intersect is known as
answer
Equilibrium
question
The primary purpose of the production function is to determine
answer
How much to produce
question
On a chart, a line that connects all the high points as the markets move higher forms a trend line. When projected out, it forms points of
answer
Resistance
question
When a market has huge swings on a daily basis, it is described as
answer
Volatile
question
What does the Production Function indicate for an agricultural producer
answer
How output responds to inputs
question
The point where Marginal Costs=Marginal Revenue is
answer
Where profits are at a maximum
question
What does marginal cost measure
answer
The change in the cost by adding another unit of input
question
Suppose that the supply curve shifts right. What is the most likely effect on price and quantity
answer
Price will decrease and quantity will increase
question
When an increase in the level of production of one enterprise causes a reduction in the level of production in another enterprise, these two enterprises are said to be
answer
Competitive
question
The ________ is King in the market place
answer
Consumer
question
The middlemen in the marketing system operate on
answer
Margin
question
Elements of the past several agriculture government programs have tried to reduce the influence that the program would have on
answer
World markets
question
Price movements over time occur because of
answer
Demand shifts & Supply shifts (Both A&B)
question
The operator knows that the value of the dollar on the world market can have an impact on grain markets. If the dollar increases in value related to other currencies, it will impact U.S. corn and wheat prices in what way.
answer
Make corn and wheat prices higher on world market.
question
Comparing the retail price to the farm price for an agricultural commodity allows you to determine the portion of each dollar spent at the retail level that farmers receive for their commodities. The difference between retail value and the farm value is
answer
Marketing margin
question
"Entrepreneurship" is
answer
The talent of organizing the use of land, labor and capital, among other things
question
Some years ago, chemists at 3M Corporation were trying to create a super-strong glue. Somehow they got their molecules twisted and came up with one of the weakest glues ever made. Rather than pouring it down the drain, they tried coating some paper with it. Voila! The "Post-It Note" was born. In this case, 3M was acting as
answer
An entrepreneur
question
A cost that is incurred when an actual monetary payment is made is a(n) ________ cost.
answer
Explicit
question
Which of the following is true?
Economists calculate only economic profit, and accountants calculate only accounting profit.
Economic profit is always greater than accounting profit.
Accounting profit is the difference between total revenue and explicit costs.
Economic profit is the difference between total revenue and explicit costs.
Economists calculate only economic profit, and accountants calculate only accounting profit.
Economic profit is always greater than accounting profit.
Accounting profit is the difference between total revenue and explicit costs.
Economic profit is the difference between total revenue and explicit costs.
answer
Accounting profit is the difference between total revenue and explicit costs.
question
Which of the following statements is false?
Money must change hands before a cost can be incurred.
No monetary payment takes place when an implicit cost is incurred.
Costs may be either explicit or implicit.
Costs implies that a sacrifice has been made.
Money must change hands before a cost can be incurred.
No monetary payment takes place when an implicit cost is incurred.
Costs may be either explicit or implicit.
Costs implies that a sacrifice has been made.
answer
Money must exchange hands before a cost can be incurred.
question
Economic profit is the difference between total revenue and
answer
The sum of explicit and implicit costs
question
Average fixed cost
answer
Is usually greater at lower levels of output than at higher levels AND exists only in the short run
question
At 200 units of output, total cost is $36,000 and total variable cost is $20,000. What does total fixed cost equal at 200 units?
answer
$16,000
question
Which of these statements is false?
There are no fixed costs in the long run.
Total costs are equal to total fixed costs plus total variable costs.
In the short run, all inputs are fixed inputs.
A fixed cost is a cost that does NOT change as output changes.
There are no fixed costs in the long run.
Total costs are equal to total fixed costs plus total variable costs.
In the short run, all inputs are fixed inputs.
A fixed cost is a cost that does NOT change as output changes.
answer
In the short run, all inputs are fixed inputs.
question
Costs that do not change with output are called _____ costs
answer
Fixed
question
Suppose that one fixed and one variable input are used to produce good X. As the marginal physical product of the variable input increases, then marginal cost
answer
Decreases
question
The law of demand states that price and quantity demanded are
answer
Inversely related, ceteris paribus
question
Tobacco production is one of the more heavily subsidized industries in the United States. Suppose that as a result of intense lobbying from health-related concerns, Congress repeals the tobacco farms' subsidies. Which of the following scenarios would likely occur?
answer
The tobacco farms' supply curve would shift leftward, since it would now cost more to produce each level of output.
question
Which of the following will NOT shift a supply curve?
answer
A change in the good's own price.
question
At a price above equilibrium price, there is
answer
A surplus
question
On a supply-and-demand diagram, equilibrium is found
answer
Where the demand and supply curves intersect
question
Price elasticity of demand is a measure of the responsiveness of quantity demanded to changes in
answer
Price
question
If quantity demanded rises by 90 percent as price falls by 40 percent, the coefficient of price elasticity of demand equals
answer
2.25 (90/40)
question
A normal good is
answer
A good for which demand rises as income rises
question
If the percentage change in quantity demanded of a good is less than the percentage change in income, then the good is said to be
answer
Income elastic
question
If the percentage change in quantity demanded of a good is equal to the percentage change in income, then the good is said to be
answer
Income unit elastic
question
Which of the following is NOT an assumption of the theory of perfect competition?
There are many sellers and many buyers, none of which is large in relation to the total sales or purchases.
Each firm produces and sells a differentiated product.
Buyers and sellers have all relevant information with respect to prices.
There is easy entry and exit.
There are many sellers and many buyers, none of which is large in relation to the total sales or purchases.
Each firm produces and sells a differentiated product.
Buyers and sellers have all relevant information with respect to prices.
There is easy entry and exit.
answer
Each firm produces and sells a differentiated product
question
Real-world markets that approximate the four assumptions of the theory of perfect competition include
answer
Some agricultural markets AND the stock market
question
In the theory of perfect competition,
answer
buyers and sellers of the product know everything that there is to know about the product
question
Which of the following industries is the best real-world example of monopolistic competition?
Cotton
Electricity generation
Automobiles
Service Stations
Cotton
Electricity generation
Automobiles
Service Stations
answer
Electricity generation
question
If monopolistic competitive firm raises its price, then
answer
it should expect to lose some, but not all, of its customers
question
Which of the following is an assumption of the theory of oligopoly?
answer
There are barriers to entry AND firms produce and sell either homogenous or differentiated products
question
Concentration ratios are NOT perfect guides not industry concentration, because they
answer
Do not take into account foreign competition and competition from substitute goods
question
A concentration ratio indicates the
answer
percentage of total sales accounted for by the (for example) four larger firms
question
A monopolist can sell 15,000 units at a price of $100 per unit. Lowering price by $1 raises the quantity demanded by 500 units. What is the change in total revenue resulting from this price change?
answer
$34,500
question
The N.M. Corporation has exactly the same costs of production as last year except for fixed costs, which are $50,000 this year compared to $30,000 last year. Which of the following statements is false?
answer
The total cost curve will be the same this year as last year. (It will not)
question
The marginal cost of making the 100th unit is $50 and the average total cost of the 100th unit is $100. What do we know about the average total cost curve at a quantity of 100?
answer
It is falling (decreasing)
question
If the wage rate increases, which of the following will NOT happen?
answer
The total fixed cost curve will shift up. (fixed cost doesn't change)
question
Pete's Burgers has fixed costs of $200. When Pete's Burgers makes 500 hamburgers, their variable costs are $150. When Pete's makes 600 hamburgers, their variable costs are $250. The average total cost when they are making 600 hamburgers is _________; and the marginal cost for the range between 500 and 600 hamburgers is _________.
answer
ATC=$0.75; MC=$1.00
question
Suppose that you are evaluating the market for baseball bats. Louisville Slugger produces the "Barry Bonds" bat. Since his record breaking 73 home runs more kids prefer his bat to any other. What will happen in the market for the Bonds' bat?
answer
Both the price and the quantity will increase
question
The price of eggs will drop when
answer
The number of egg farms increase
question
Grocery stores do not often advertise sales prices on table salt because
answer
The demand for salt is inelastic
question
Jack sells peanuts outside of Jacob's Field in Cleveland. He currently charges $3 for a bag of peanuts. If Jack's customers have a price elasticity of demand of $0.75, which of the following statements are true.
answer
If Jack increases his price, he could increase his total revenue
question
Suppose that an increase in income increases the demand for granola bars and that a decrease in the price of grapes decreases the demand for granola bars. Based on this information, which of the following do we know about granola bars?
answer
Granola bars are normal goods, and granola bars and grapes are substitutes.
question
When the price of Moose Tracks ice cream increases from $3 to $4, the quantity demanded of Moose Tracks ice cream decreases from 1,000 to 900 and the quantity demanded of Chubby Hubby ice cream increases from 500 to 550. The cross elasticity of demand is ______ and Moose Tracks and Chubby Hubby are ___________
answer
0.33; substitutes
question
Suppose the price of eggs fall and a chicken farmer decides to sell all his chickens for meat rather than keeping them to lay eggs. The elasticity of supply for the farmer would be
answer
Elastic
question
If the government imposes a tax on suppliers, the equilibrium price of the product will ________ and the equilibrium quantity of the product will ________
answer
Increase; decrease
question
In a market with a dominant firm and a competitive fringe, the dominant firm's demand curve shows the ________ that will occur in the competitive market at each price _____ the equilibrium.
answer
Shortage; below
question
One force that has helped cause U.S. farms to become larger and fewer is
answer
Lower production costs per unit by spreading fixed investment technology over more units
question
An increase in the number of non-farmers living in rural areas will cause
answer
Farmers to pay more attention to off-farm effects of their production practices
question
What is the source of economic incentives that can stimulate production
answer
Demand
question
The best reason for producers to use technology is to
answer
Maximize profits
question
In modern production agriculture it is important to remember that the producer is
answer
A price taker
question
If more farmers start to produce organic milk to the point of oversupply, the result is
answer
A lower price
question
A demand curve shows the relationship between quantity purchased and
answer
quality
question
When the market price falls below the cost of production of a commodity, this lower price may force the producer to
answer
Produce more of that product
question
In the short run what prompts most of the price variability in commodities?
answer
Location
question
What does stage two of the production function graph determine?
answer
The amount of variable input to use
question
The point on a production function graph where marginal cost equals marginal revenue is where
answer
Profits will be the greatest
question
An agriculture producer learns what from the production function?
answer
Output responses to an input
question
On the production function graph the MC=MR, what does this tell the producer?
answer
Where losses will be the least, where change in cost and change in revenue are the same, where profits are the greatest.
question
What is Stage II of the Production Function?
answer
The decision making stage
question
Anytime a consumer will take more only at a lower price is called
answer
Demand
question
The dynamic process of searching for the equilibrium or market-clearing prices is called
answer
Discovery
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
