Question 1

1 in Figure 29.1,there would be a A) Shortage measured by the distance Q1 to Q5. B) Shortage measured by the distance Q1 to Q3. C) Surplus measured by the distance Q1 to Q5. D) Surplus measured by the distance Q2 to Q4." class="answers-bank-image d-inline" rel="preload" > Refer to Figure 29.1.At a price of P1 in Figure 29.1,there would be a

Accepted Answer

A)  Shortage measured by the distance Q1 to Q5.
B)  Shortage measured by the distance Q1 to Q3.
C)  Surplus measured by the distance Q1 to Q5.
D)  Surplus measured by the distance Q2 to Q4.

Question 2

The exit of farms from a market should

Accepted Answer

A)  Shift the agricultural market supply curve to the right.
B)  Increase the equilibrium market price.
C)  Decrease the equilibrium market price.
D)  Increase the equilibrium market output.

Question 3

During the period from 1910 to 1919,demand for U.S.farm goods

Accepted Answer

A)  Increased because of the expanded foreign demand.
B)  Increased because of the improved farm technology.
C)  Decreased because of the Great Depression.
D)  Decreased because of restrictions on international trade.

Question 4

If the support price is set below the equilibrium market price,

Accepted Answer

A)  A surplus will result.
B)  A shortage will result.
C)  The equilibrium price will result.
D)  There will be upward pressure on prices.

Question 5

Graphically show how a price floor works and tell how Congress acts to restrict supply to prop up farm prices.

Accepted Answer

Refer to the Fair Prices and Market Surp...

Question 6

The principal cause of a third farm depression beginning in 1997 was

Accepted Answer

A)  A crop failure in 1998.
B)  The Asian economic crisis.
C)  A decrease in grain prices.
D)  Environmental damage.

Question 7

The loan rate is the

Accepted Answer

A)  Interest rate farmers pay banks for loans.
B)  Same as the prime lending rate.
C)  Implicit price paid by the government for surplus crops taken as collateral for loans to farmers.
D)  Difference in the market price and the cost of production.

Question 8

The 1996 Farm Act

Accepted Answer

A)  Abolished the subsidy programs for all farm products.
B)  Increased the amount of acreage set-asides.
C)  Reregulated the farming industry.
D)  Further deregulated the farming industry.

Question 9

Which of the following characterizes a typical agricultural market?

Accepted Answer

A)  A horizontal demand curve for the industry.
B)  Market power on the part of each farmer.
C)  A downward-sloping demand curve for the firm.
D)  Low barriers to entry.

Question 10

Select the letter of the diagram in Figure 28.1 that best represents the effect of each event on the United States wheat market,ceteris paribus: A bumper wheat crop in the midwest.(See Figure 29.4. )

Accepted Answer

A)  a.
B)  b.
C)  c.
D)  d.

Question 11

If an agricultural price support keeps a price above the equilibrium market price,

Accepted Answer

A)  Shortages of agricultural products will result.
B)  More resources will be devoted to agriculture than are optimal.
C)  There will be redistribution of income from the government to consumers.
D)  There will be positive market feedback leading to even higher prices.

Question 12

Because there are 2 million farms in the United States,individual farmers have some market power.

Accepted Answer

A) True 
 B)False

Question 13

The 1996 Farm Act

Accepted Answer

A)  Called for a phaseout of farm subsidies.
B)  Reduced loan rates.
C)  Increased the amount of set-aside acreage.
D)  Increased government support prices.

Question 14

The biggest plunge in farm incomes occurred

Accepted Answer

A)  During WWI.
B)  During the Great Depression of the 1930s.
C)  After WWII.
D)  The early 1900s.

Question 15

The relationship between farm and nonfarm prices that existed during the period from 1910 to 1914 is known as

Accepted Answer

A)  The payment-in-kind program.
B)  The target price.
C)  The parity price.
D)  Price supports.

Question 16

In the United States,in general,farmers behave like

Accepted Answer

A)  Monopolists.
B)  Oligopolists.
C)  Perfect competitors.
D)  Monopolistic competitors.

Question 17

An increase in fuel prices resulted in higher costs in agriculture during the 1980s.

Accepted Answer

A) True 
 B)False

Question 18

Parity pricing refers to the relative price of farm products to nonfarm products in the period

Accepted Answer

A)  1930
B)  1985-2014.
C)  1910
D)  1950

Question 19

If an agricultural market is perfectly competitive,then

Accepted Answer

A)  A farmer is a price taker.
B)  A farmer practices price discrimination.
C)  The market demand curve is perfectly elastic.
D)  Each firm's demand curve is perfectly inelastic.

Question 20

The farming industry experiences high barriers to entry because of the large amounts of acreage and expensive equipment that are needed.

Accepted Answer

A) True 
 B)False

Exam 29: The Farm Problem

During the period from 1910 to 1919,demand for U.S.farm goods

Correct AnswerverifiedShow Answer

Refer to Figure 29.1.At a price of P1 in Figure 29.1,there would be a

Correct AnswerverifiedShow Answer

The relationship between farm and nonfarm prices that existed during the period from 1910 to 1914 is known as

Correct AnswerverifiedShow Answer

Graphically show how a price floor works and tell how Congress acts to restrict supply to prop up farm prices.

Correct AnswerverifiedRefer to the Fair Prices and Market Surp...View AnswerShow Answer

An increase in fuel prices resulted in higher costs in agriculture during the 1980s.

Correct AnswerverifiedShow Answer

The farming industry experiences high barriers to entry because of the large amounts of acreage and expensive equipment that are needed.

Correct AnswerverifiedShow Answer

The biggest plunge in farm incomes occurred

Correct AnswerverifiedShow Answer

Parity pricing refers to the relative price of farm products to nonfarm products in the period

Correct AnswerverifiedShow Answer

Because there are 2 million farms in the United States,individual farmers have some market power.

Correct AnswerverifiedShow Answer

If the support price is set below the equilibrium market price,

Correct AnswerverifiedShow Answer

The 1996 Farm Act

Correct AnswerverifiedShow Answer

The principal cause of a third farm depression beginning in 1997 was

Correct AnswerverifiedShow Answer

Select the letter of the diagram in Figure 28.1 that best represents the effect of each event on the United States wheat market,ceteris paribus: A bumper wheat crop in the midwest.(See Figure 29.4. )

Correct AnswerverifiedShow Answer

If an agricultural market is perfectly competitive,then

Correct AnswerverifiedShow Answer

The loan rate is the

Correct AnswerverifiedShow Answer

The 1996 Farm Act

Correct AnswerverifiedShow Answer

In the United States,in general,farmers behave like

Correct AnswerverifiedShow Answer

If an agricultural price support keeps a price above the equilibrium market price,

Correct AnswerverifiedShow Answer

Which of the following characterizes a typical agricultural market?

Correct AnswerverifiedShow Answer

The exit of farms from a market should

Correct AnswerverifiedShow Answer

Correct Answer
verified

Refer to Figure 29.1.At a price of P₁ in Figure 29.1,there would be a

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Refer to the Fair Prices and Market Surp...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified