Question 1

In 2015, Farmer Lactose's dairy farm lost money. Under the Agricultural Act of 2014 dairy margin protection program, which of the following events would have triggered payments to Farmer Lactose?

Accepted Answer

A)  only the price of milk falling too low
B)  only the price of feed rising too high
C)  either the price of milk falling too low or the price of feed rising too high
D)  if the collective revenue of all dairy farmers in the county fell too lowE) B) and D)
F) A) and B)

Question 2

Overproduction of farm products in the European Community has been primarily the result of

Accepted Answer

A)  low U.S. tariffs on imports of farm products.
B)  subsidies to farmers in the European Community.
C)  increasing world trade in agricultural commodities.
D)  quotas imposed by the European Community on imported products.E) All of the above
F) A) and B)

Question 3

What is a bumper crop? Explain how fluctuations in farm output lead to large changes in agricultural prices and income.

Accepted Answer

A bumper crop is referring to unusually ...

Question 4

What points did the Agricultural Act of 2014 address?

Accepted Answer

The Agricultural Act of 2014 ended direc...

Question 5

As a result of the acreage allotment programs, we would expect

Accepted Answer

A)  the best farmland to be taken out of production by farmers.
B)  the worst farmland to be taken out of production by farmers.
C)  lower farm incomes.
D)  lower farm prices.E) A) and B)
F) A) and C)

Question 6

Fixed costs faced by farmers typically include the following, except

Accepted Answer

A)  family labor.
B)  fertilizer.
C)  property taxes.
D)  interest and rent payments.E) A) and B)
F) C) and D)

Question 7

Acreage allotments, which limit the number of acres planted with a particular crop, have an effect on the crop's price that is

Accepted Answer

A)  consistent with a price-support program.
B)  contradictory to a price-support program.
C)  consistent with a price-ceiling for the crop.
D)  disadvantageous to the farmers of the crop.E) All of the above
F) A) and D)

Question 8

The problem faced by farms in the long run as portrayed in the diagram would involve price and quantity changes from

Accepted Answer

A)  P₂ to P₃ and Q₁ to Q₄.
B)  P₁ to P₄ and Q₁ to Q₄.
C)  P₂ to P₁ and Q₁ to Q₂.
D)  P₄ to P₁ and Q₄ to Q₁.E) A) and C)
F) B) and D)

Question 9

The Agricultural Act of 2014 expanded the direct payments, countercyclical payments, and marketing loans provided by the Food, Conservation, and Energy Act of 2008.

Accepted Answer

A) True 
 B)False

Question 10

Expanding per capita incomes in the United States have resulted in a(n)

Accepted Answer

A)  more-than-proportionate increase in the demand for agricultural products.
B)  proportionate increase in the demand for agricultural products.
C)  less-than-proportionate increase in the demand for agricultural products.
D)  absolute decline in the amount of agricultural products consumed.E) B) and D)
F) B) and C)

Question 11

A major criticism of the parity concept is that

Accepted Answer

A)  it is based on relative prices from a long time ago.
B)  it is not easily and objectively measured.
C)  the index is tracked by the government, not the private sector.
D)  there is no economic rationale for the concept.E) A) and B)
F) A) and C)

Question 12

Refer to the diagram for the corn market. Assuming no externalities, a price support of B causes

Accepted Answer

A)  economies of scale.
B)  production to be less profitable to farmers.
C)  an underallocation of resources to this product.
D)  an overallocation of resources to this product.E) A) and B)
F) B) and C)

Question 13

One reason for the year-to-year instability of agricultural product demand is the

Accepted Answer

A)  high price-elasticity for agricultural products.
B)  fluctuations in weather patterns.
C)  declining role of technological progress in agriculture.
D)  greater dependence on exports to foreign markets.E) A) and C)
F) A) and B)

Question 14

Based on World Bank data for 2015-2018, which of the following countries has the highest percentage of its labor force still in agriculture?

Accepted Answer

A)  Brazil
B)  Honduras
C)  France
D)  JapanE) A) and D)
F) None of the above

Question 15

If the prices of agricultural products fall, then the quantities demanded usually

Accepted Answer

A)  do not increase by much because the price-changes are often small.
B)  do not increase by much because there are no close substitutes.
C)  increase significantly because the products satisfy basic needs.
D)  increase significantly because the products have no close substitutes and are necessities.E) None of the above
F) All of the above

Question 16

The Food for Peace program

Accepted Answer

A)  established price supports of 100 percent of parity.
B)  restricted American exports by restricting shipments to specific communist nations.
C)  expanded American exports by permitting less-developed countries to buy American surplus products with their own currencies.
D)  provided job training to farmers and farm workers who move to urban areas seeking employment.E) None of the above
F) B) and C)

Question 17

Which of the following is correct?

Accepted Answer

A)  The rapid expansion of foreign incomes will reduce U.S. agricultural exports.
B)  A decrease in the international value of the dollar will reduce U.S. agricultural exports.
C)  An increase in the international value of the dollar will reduce U.S. agricultural exports.
D)  Changes in the international value of the dollar have no effect on U.S. agricultural exports.E) A) and B)
F) All of the above

Question 18

The Agricultural Act of 2014

Accepted Answer

A)  maintained the "freedom to plant" and "direct-payment" features of the Freedom to Farm Act of 1996, and also provided countercyclical payments and marketing loans to assist farmers.
B)  restored the U.S. price support system (for currently grown crops) that was ended in the Freedom to Farm Act of 1996.
C)  ended the "freedom to plant" approach of the Freedom to Farm Act of 1996 and restored acreage allotments.
D)  ended both direct payments and countercyclical payments to farmers.E) None of the above
F) B) and D)

Question 19

As a nation's average household income rises, the percentage of household income that goes to food expenditures also increases.

Accepted Answer

A) True 
 B)False

Question 20

Because the demand for food is relatively price inelastic, what effects would you expect to see as a result of technological advances that reduce the cost of food production?

Accepted Answer

A)  Food prices would rise, but farm incomes would decline.
B)  Food prices would rise and farm incomes would rise.
C)  Food prices would decline and farm incomes would decline.
D)  Food prices would decline, but farm incomes would rise.E) All of the above
F) A) and D)

Exam 22: Agriculture: Economics and Policy

In 2015, Farmer Lactose's dairy farm lost money. Under the Agricultural Act of 2014 dairy margin protection program, which of the following events would have triggered payments to Farmer Lactose?

Correct AnswerverifiedShow Answer

Overproduction of farm products in the European Community has been primarily the result of

Correct AnswerverifiedShow Answer

Because the demand for food is relatively price inelastic, what effects would you expect to see as a result of technological advances that reduce the cost of food production?

Correct AnswerverifiedShow Answer

A major criticism of the parity concept is that

Correct AnswerverifiedShow Answer

One reason for the year-to-year instability of agricultural product demand is the

Correct AnswerverifiedShow Answer

The Food for Peace program

Correct AnswerverifiedShow Answer

If the prices of agricultural products fall, then the quantities demanded usually

Correct AnswerverifiedShow Answer

Acreage allotments, which limit the number of acres planted with a particular crop, have an effect on the crop's price that is

Correct AnswerverifiedShow Answer

The Agricultural Act of 2014 expanded the direct payments, countercyclical payments, and marketing loans provided by the Food, Conservation, and Energy Act of 2008.

Correct AnswerverifiedShow Answer

Expanding per capita incomes in the United States have resulted in a(n)

Correct AnswerverifiedShow Answer

The problem faced by farms in the long run as portrayed in the diagram would involve price and quantity changes from

Correct AnswerverifiedShow Answer

What is a bumper crop? Explain how fluctuations in farm output lead to large changes in agricultural prices and income.

Correct AnswerverifiedA bumper crop is referring to unusually ...View AnswerShow Answer

Based on World Bank data for 2015-2018, which of the following countries has the highest percentage of its labor force still in agriculture?

Correct AnswerverifiedShow Answer

What points did the Agricultural Act of 2014 address?

Correct AnswerverifiedThe Agricultural Act of 2014 ended direc...View AnswerShow Answer

Fixed costs faced by farmers typically include the following, except

Correct AnswerverifiedShow Answer

The Agricultural Act of 2014

Correct AnswerverifiedShow Answer

Refer to the diagram for the corn market. Assuming no externalities, a price support of B causes

Correct AnswerverifiedShow Answer

As a nation's average household income rises, the percentage of household income that goes to food expenditures also increases.

Correct AnswerverifiedShow Answer

As a result of the acreage allotment programs, we would expect

Correct AnswerverifiedShow Answer

Which of the following is correct?

Correct AnswerverifiedShow Answer

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A bumper crop is referring to unusually ...
View Answer

Correct Answer
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The Agricultural Act of 2014 ended direc...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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