question

Demand elasticities for food tend to be ________________________. This is because consumers (especially in the U.S.) respond relatively little to changes in food prices, ceteris paribus.

answer

low

question

The fact that agricultural marketing involves input suppliers, farm production, brokering, processing, storage, wholesaling, and retailing is a sign that it is ________________________.

answer

Multistage

question

Farm-level corn prices in the U.S. are the same and do not change based on how difficult or easy it is for brokers to distribute this product. (T/F)

answer

False

question

Why would a global market for fresh watermelon likely be a very small or non-existent market?

answer

Watermelons are expensive to transport relative to their value.

question

Different markets along the marketing supply chain (e.g., farm-level versus wholesale versus retail market) are typically defined by the __________________.

answer

seller (e.g., farm-level markets have farmers as sellers)

question

The same process that is used to create an index is used to rescale an index. (T/F)

answer

True

question

When calculating percent change (i.e., calculating a "share" of something), the "from" value is the "old" value and the "to" value is the "new" value. For instance, calculate the percent change in population from 1960 (value = 180 million) to 2010 (value = 309 million). For this question, you would use the formula "new minus old divided by old". So, (309 - 180) / 180 times 100 or 71.66. (T/F)

answer

True

question

The single largest industry sector comprising all U.S. food expenditures in 2011 is

answer

food service

question

In the U.S., consumers annually spent on average about __________________ on food per capita in 2010?

answer

$4000

question

An increase in the overall price level is also known as __________________ (one word).

answer

inflation

question

In the U.S., the U.S.D.A. recognizes ____________ grades for eggs.

answer

3

question

Which of the following government interventions seeks to moderate market supplies of agricultural commodities directly?

answer

Production controls

question

Only 1.031 pounds of fresh carrots are needed at the farm level to yield 1 pound of fresh carrots at the retail level. Why is the conversion factor for carrots so low?

answer

Fresh carrots do not spoil or damage easily

question

The fact that U.S. consumers increasingly want fresher, more nutritious, and visually more appealing food products is one reason that the U.S. food marketing bill is increasing. (T/F)

answer

True

question

GMO stands for "genetically modified organisms" (e.g., Round Up(R) ready soybeans). (T/F)

answer

True

question

When defining agricultural markets, the choice of space depends on the particular ways that the good or service is ______________________.

answer

distributed

question

Markets are comprised of three elements: buyers, sellers, and ____________________ (one word).

answer

organization

question

In the U.S., about _______________ percent of all laborers are farmers.

answer

less than 2%

question

Market characteristics should be ones that consumers "recognize". In this context, the word "recognize" means:

answer

to value

question

Marketing adds value by enhancing the location, form, or ___________________ of goods or services (one word).

answer

possession

question

In 2010, U.S. consumers spent on average about _____________ percent of their disposable income on food.

answer

11

question

Real values are equal to ______________________.

answer

the nominal value divided by the price index value times 100

question

Food in general is a normal good. When consumer incomes increase, the quantity demanded of any particular normal good increases, ceteris paribus. This implies that the income elasticity for food is ______________________.

answer

postive

question

Calculate the percent change in real per capita food expenditures from 1960 to 2010 using Table 1 in this lesson. Enter only the number.

answer

33.4 (with margin:0)

question

Farm value share is calculated by dividing __________________________ (two words) by the total consumer food expenditures and then multiplying by 100.

answer

farm value

question

The marketing costs associated with individual food products or limited groups of food products are described by farm-to-retail ____________________ (two words).

answer

price spread

question

Commodities accumulated under U.S. nonrecourse loan programs are NOT distributed to which of the following?

answer

Brokers and dealers on spot market exchanges

question

Retail price minus farm value equivalent equals farm-to-retail price spread. (T/F)

answer

True

question

Why have farm value shares (i.e., the share of the retail price that goes to pay farmers) been decreasing for individual food products and limited groups of products?

answer

Consumers are demanding more processed and highly packaged foods

question

When calculating disappearance, XT refers to exports during this time period. (T/F)

answer

True

question

A yard sale is an example of a market. (T/F)

answer

True

question

A person who buys thoroughbred horses solely for racing likely does not "recognize" the color of these horses since color has never been proven to affect the speed of horses. (T/F)

answer

True

question

According to your text, why do international development agencies (e.g., USAID) often hire agricultural economists?

answer

Because developing countries tend to have more agricultural related workers and GDP.

question

In the U.S., farming accounts for approximately what percent of Gross Domestic Product (GDP)?

answer

1%

question

According to the Big Mac Index (2013), a Big Mac cost approximately how much more or less as a percent in Norway than in the United States.

answer

about 62 percent more

question

Total consumer food expenditures are comprised of two components. One of these components describes the costs to get all U.S. produced food from all the farm gates into the hands of final consumers. This component is called the _______________________________ (two words).

answer

marketing bill

question

Since 1960, aggregate nominal income in the U.S. has ___________________.

answer

increased

question

Given the following information for 2010 in nominal values, calculate nominal Farm Value Share. Farm Value: 176.9 billion dollars Marketing Bill: 1073.8 billion dollars Consumer Food Expenditures: 1,250.7 billion dollars Population: 309 million Income: 11,379.9 billion dollars CPI: 218.1

answer

14.25 (Between 14.0 and 14.25)

question

The USDA estimates that 2.4 pounds of steer and 1.042 pounds of potatoes are required to yield one pound of each of these products at the retail level. What best explains why the conversion factor for beef is higher than for potatoes?

answer

Beef requires more processing and higher cost inputs to grow than potatoes

question

One important reason that the U.S. food marketing bill has increased rapidly in recent decades is changing consumer preferences (e.g., for more processed meals). (T/F)

answer

True

question

Agricultural marketing is a multidisciplinary field of study that includes many different kinds of laborers in addition to farmers. Other groups of jobs related to agricultural marketing include truckers, factory workers, lawyers, accountants, and psychologists. According to your text, another job group related to agricultural marketing is ________________________ (one word). Note: multiple correct answers. Be sure your answer completes the sentence in a grammatically correct way.

answer

Artists Soil scientists economist Planners Grocers chef planner artist Geographers Engineers geographer grocer Psychologists Chefs trader Traders psychologist Economists engineer soil scientist

question

A "pick your own" fruit or vegetable market is most likely a ____________ market.

answer

local

question

The incomes of nearly half the world's population are determined principally by the prices received for agricultural commodities (e.g., maize, sorghum, cassava, rice, potatoes, etc.). (T/F)

answer

True

question

If total annual U.S. consumer food expenditures were $1,300 billion and if the U.S. farm value for that same year was $200 billion, the total U.S. food marketing bill for that year was _____________ billion?

answer

$1100 billion

question

When talking about indices in the U.S., CPI stands for Consumer Price Index. (T/F)

answer

True

question

Unambiguous descriptions of products that allow easy categorization of individual units by buyers and sellers based on relevant criteria for the purposes of trade are called ___________________ (two words).

answer

grade standards

question

When calculating disappearance, BST+1 refers to beginning stocks next period or to ending stocks this period. (T/F)

answer

True

question

Farm-to-retail price spreads are calculated as the difference between the average food store price and the farm value equivalent quantity of raw food materials. (T/F)

answer

True

question

Which of the following are not reasons that individual firms are creating and using their own, private standards rather than government-defined standards?

answer

none of these (i.e., all of these are reasons for this trend) (options were: To create a reputation of greater quality assurance among consumers compared to rival firms; to raise transactions costs and entry barriers for potential competitors; To penetrate and/or develop niche markets earlier, more easily, and at lower cost )

question

All agricultural products go through the same marketing chain (e.g., farmer to processor to wholesaler to retailer to end consumer). (T/F)

answer

False

question

Two agricultural economists debated about the marketing chain for cheese. Mr. Green said that the marketing chain consisted of all seven of the major agricultural marketing sectors. Ms. Blue said that it included fewer sectors. Who is right?

answer

Both The answer is both. The agricultural marketing chain can be longer and involve many different sectors (e.g., farmers, processors, wholesalers, retailers, and final consumers) or the chain can be much shorter (e.g., farmer and final consumers). Bulk producers tend to focus on efficiency and therefore utilize many of the marketing chain levels. Smaller, niche producers (e.g., farm-direct producers) often utilize fewer levels of the chain.

question

Agricultural markets should be defined clearly in order to avoid unnecessary ___________________________.

answer

argument and confusion

question

Using the calculator that you use will on the exam, calculate what 123 billion is divided by 456 million. (NOTE: Many basic calculators aren't able to perform this calculation directly. This question seeks to make sure that you remember how to move the decimal points.)

answer

270

question

For an index, the value in the base period is always 100 or sometimes it can be 1 if the index ranges from 0 to 1 instead of 1 to 100. (T/F)

answer

True

question

The single largest industry sector comprising all U.S. food expenditures in 2011 is ___________________.

answer

food services

question

In lower income countries (e.g., Nigeria), consumers tend to spend a higher percentage of their disposable income on food. (T/F)

answer

True

question

In the U.S., the U.S.D.A. recognizes ____________ grades for beef.

answer

8

question

According to the supply/use identity, total supply should equal total use for a given period of time. (T/F)

answer

True

question

According to the USDA Economic Research Service, how many pounds of hog at the farm level are needed to yield one pound of pork at the retail level?

answer

1.869

question

Commodities accumulated under U.S. nonrecourse loan programs are distributed via non-competing channels mostly as free or subsidized food aid. Why does the government not sell the commodity back into traditional marketing channels (e.g., using spot markets)?

answer

Doing so would only push agricultural commodity prices lower

question

In most low income countries, the agricultural sector is relatively ____________________ as a percent of overall GDP.

answer

large

question

In the summer of 2008, retail gasoline prices in the central Kentucky market area were ________________________ compared to retail gasoline prices in other U.S. retail markets.

answer

nearly the same

question

Most agricultural markets change over time. (T/F)

answer

True

question

The incomes of nearly half the world's population are determined principally by the prices received for agricultural commodities (e.g., maize, sorghum, cassava, rice, potatoes, etc.). (T/F)

answer

True

question

From 1960 to 2010, agricultural productivity increased by approximately _________ percent.

answer

122

question

Farm Value + Marketing Bill = Total Consumer Food Expenditures. (T/F)

answer

True

question

Which of the following government interventions is designed to maintain minimum market prices?

answer

Price supports

question

Agricultural markets in the U.S. are unique because government subsidies tend to be relatively ____________.

answer

low

question

Farm-level corn prices in the U.S. are the same and do not change based on how difficult or easy it is for brokers to distribute this product. (T/F)

answer

True

question

Nominal U.S. per capita food expenditures increased 883% from 1960 to 2010 while the increase in real terms was only 33%. (T/F)

answer

True

question

From 1980 to 2009, U.S. per capita consumption of tree nuts (shelled) more than doubled. (T/F)

answer

True

question

Nominal prices, also known as "current prices", are the prices paid at the time of purchase. (T/F)

answer

True

question

Which of the following are not current trends with respect to commodity grade standards?

answer

They are increasingly focused on outcome-based rather than process-based standards (other choices: They are increasingly firm-specific with private firms using their own standards rather than government-defined standards; They are increasingly used as strategic marketing tools to aid product differentiation)

question

Some firms along the agricultural marketing chain transform raw agricultural products into other forms by adding desirable or removing undesirable characteristics (e.g., transforming wheat into bread or corn into corn syrup). These firms are collectively known as _______________________ (one word).

answer

processors

question

The U.S. Consumer Price Index (CPI) weighs the food and beverage portion of overall consumer expenditures at ____________ percent. (Note: Enter only the number.)

answer

17.4

question

Two reasons that the U.S. food marketing bill has increased in recent decades are higher disposable incomes and higher total population. (T/F)

answer

True

question

Calculate real per capita income in 2005 (1982-1984 = 100) given the following information:

answer

16100 (between 16000 and 16100)

question

Which of the following types of products utilize and depend upon standards most?

answer

Agricultural products

question

The fact that U.S. consumers increasingly want fresher, more nutritious, and visually more appealing food products is one reason that the U.S. food marketing bill is increasing (T/F)

answer

True

question

Production lags suggest that supply elasticities in agricultural tend to be relatively _________________.

answer

Low (i.e., inelastic)

question

The farm value share is that portion (or share) of total consumer food expenditures that go to farmers. (T/F)

answer

True

question

An ____________ allows for an easy percent comparison between a base period/unit and all other periods/units.

answer

index

question

Prices that have been adjusted for the effects of inflation are called ___________ prices.

answer

real

question

From 1960 to 2010, population in the U.S. increased ____________ percent.

answer

70.28

question

In the United States, tomato grows use video cameras and computers to automatically size tomatoes before they are packaged and sent to stores. (T/F)

answer

True

question

Suppose two goods, X and Y, have farm value shares equal to 0.03 and 0.62, respectively. If farm level costs increase 20% for each of these goods, retail prices will increase most for which good, X or Y?

answer

Y

question

Which of the following government interventions seeks to moderate market supplies of agricultural commodities?

answer

The tobacco quota program prior to the 1998 buyout

question

Grade standards generally have two requirements. One, they must based on measurable attributes, and two they must be __________________.

answer

based on attributes that are recognized (i.e., valued) by consumers

question

Most retail markets are _______________________ markets.

answer

local

question

Markets should be defined characteristically in time and _________________.

answer

space

question

Engel's Law states that, as incomes rise, consumers tend to spend less money (i.e., fewer dollars) on food. (T/F)

answer

False

question

According to this lesson's lecture, the nominal price of one gallon of gasoline in 1913 was __________________ cents.

answer

15

question

The Latin phrase that means "all else held constant" or "given no other changes" is _________________________ (two words).

answer

ceteris paribus

question

Once approved, marketing orders are different from grade standards in that the former are required. (T/F)

answer

True

question

Marketing orders may become binding on all firms in a given market area if at least _____________________ of producers by volume in that area approve the orders.

answer

two-thirds

question

The fact that agricultural products can be marketed via auctions, futures markets, contracts, marketing boards, cooperatives, or direct negotiations is an indication that agricultural marketing is ___________________________ (one word).

answer

adaptable

question

The stage of the marketing chain is often (but not always) a relevant market characteristic in agriculture. For example, while agricultural products (e.g., potatoes) move through an extended supply chain from farmers to retailers, many agricultural services (e.g., equine surgery) do not. (T/F)

answer

True

question

In 2010, real total U.S. food expenditures on food (1982-1984 = 100) were ____________ billion dollars. Enter only the number (no dollar sign).

answer

573.5

question

Farm value varies from farm to farm since the value of any particular farm's agricultural products at the farm gate varies. (T/F)

answer

False

question

Since 1955, the U.S. farm value share has generally _____________________.

answer

been decreasing

question

While grade standards can allow consumers to buy products unseen, they generally do not help lower transactions costs. (T/F)

answer

False

question

When defining agricultural markets, national political responses (e.g., to foreign disease outbreaks or trade restrictions) may restrict an otherwise larger marketing space. (T/F)

answer

True

question

Compared to Kentucky, farmland values in Ohio were ________________ in 2008.

answer

38.3 higher

question

Inflation is an important reason that the U.S. food marketing bill has increased so dramatically since World War II. (T/F)

answer

True

question

In 2011, total U.S. consumer expenditures on food in nominal terms (i.e., not adjusted for inflation) were approximately _________________.

answer

$1,317.8 billion

question

Price supports (e.g., nonrecourse loans) for perishable crops or for major livestock products do not currently exist in the United States. (T/F)

answer

True

question

One advantage of grade standards is that can help resolve disputes if, for instance, a rogue dealer sent a grocery store owner "U.S. Extra No. 1" carrots that had freeze damage. (T/F)

answer

True

question

Marketing orders in the U.S. may be approved if a requisite number of growers approve the orders. This requisite number is usually two-thirds __________________.

answer

as measured by the total volume of all products produced and sold in the market area

question

The attributes used to categorize output using grade standards may relate most generally either to a product s physical characteristics or to how it was _________________.

answer

produced (also generated, made, grown, or raised)

question

In the U.S., what entity measures disappearance (i.e., commodity consumption)?

answer

None of these (no entity measures disappearance; it is calculated as a residual using other data)

question

The seven components of the typical agricultural marketing chain include (1) input suppliers, (2) farmers, (3) processors, (4) ____________________, (5) retailers, (6) consumers, and (7) brokers/dealers.

answer

wholesalers

question

The marketing supply chain describes how an agricultural product (e.g., pork) moves from initial producers (e.g., as shoats or hogs) and eventually on to retailers where the product (e.g., as tenderloin) is sold to the final retail ________________________ (one word).

answer

consumer (or buyer)

question

Since 1960, the total U.S. food expenditures on food as a share (i.e., percent) of disposable incomes has _________________.

answer

decreased

question

In addition to agriculture, the two other major sectors of any economy are the industrial sector and the ___________________________ sector, the latter of which comprises about 80% of U.S. gross domestic product.

answer

services

question

The fact that U.S. imports of food products are ___________________ is a reflection of how globalization within the agricultural marketing is ______________________.

answer

increasing, increasing

question

Along the agricultural marketing chain, a cruise ship (e.g., that serves meals) is an example of a _______________________ (one word).

answer

retailer

question

If the retail price for pork is $3.03 per pound and the farm value equivalent is $0.81 per pound, the farm-to-retail price spread for a pound of pork is __________ dollars.

answer

2.22

question

A _________________ (two words) describes the organization of separate production stages (often different firms) that are involved in getting a particular agricultural product from the farm level to final consumers.

answer

marketing chain

question

The marketing supply chain describes how an agricultural product (e.g., pork) moves from initial producers (e.g., as shoats or hogs) and eventually on to retailers where the product (e.g., as tenderloin) is sold to the final retail ________________________ (one word).

answer

Individual buyers (or Consumer; Buyers; Consumers; Final consumers; A consumer).

question

According to Unit 1.3, there are four reasons that the U.S. food marketing bill has increased in recent decades (i.e., Table 4). Those reasons are (1) higher disposable incomes, (2) higher total population, (3) higher overall price level, and (4) ____________________________ (4 words).

answer

changes in consumer tastes

question

Farm value varies from farm to farm since the value of any particular farm's agricultural products at the farm gate varies. (T/F)

answer

False

question

In the U.S., the U.S.D.A. standards for wool are differentiated according to _____________.

answer

fiber diameter

question

Agricultural markets are unique because government subsidies tend to be relatively very ______________.

answer

high

question

A quantity index could be used to compare the percent differences in the number of cattle produced across countries. (T/F)

answer

True

question

Total consumer food expenditures are comprised of two components. One of these components describes the value of all U.S. agricultural products when they leave farms. This component is called _______________ (two words).

answer

farm value

question

Nominal prices, also known as "current prices", are the prices paid at the time of purchase. (T/F)

answer

True

question

In the U.S., the U.S.D.A. recognizes ____________ grades for cotton.

answer

38

question

One important reason that the U.S. food marketing bill has increased rapidly in recent decades is changing consumer preferences (e.g., for more processed meals). (T/F)

answer

True

question

Farm value plus marketing bill equals retail price. (T/F)

answer

False

question

Agricultural markets are relatively unique because they range from the extremes of nearly perfectly competitive to pure monopoly. (T/F)

answer

True

question

Farm Value + Marketing Bill = Total Consumer Food Expenditures.

answer

True

question

In economics, ____________________ is defined as output divided by input.

answer

productivity

question

Almond, kiwifruit, and raisin production in California was subject to marketing orders in 2004-2005. (T/F)

answer

True

question

In agricultural marketing, another word for "consumption" is _____________

answer

disappearance

question

Some agricultural products (e.g., fresh tomatoes) may be marketed by farmers directly to consumers or via a more lengthy supply chain involving processors and wholesalers. (T/F)

answer

True

question

Markets for high-value, low weight agricultural products (e.g., chocolate, spices, and coffee) are typically global because these products can be distributed relatively cheaply. (T/F)

answer

True

question

The largest component (in terms of weights) in the U.S. Consumer Price Index (CPI) is ________________________ (one word).

answer

housing

question

Unambiguous descriptions of products that allow easy categorization of individual units by buyers and sellers based on relevant criteria for the purposes of trade are called ___________________ (two words)

answer

grade standards

question

Grade standards serve two roles: they categorize output and _____________________.

answer

inform consumers

question

Agricultural marketing is basically about how to convince consumers to purchase one firm's goods and services rather than a competing firm's goods and services. (T/F)

answer

False Agricultural marketing is basically about the processes and actors involved in getting agricultural products from the farm to final consumers.

question

Economists divide economies into three sectors. These sectors are the industrial sector, the agricultural sector, and the ________________ sector.

answer

service

question

In 2010, total nominal U.S. food expenditures spent on away-from-home food (e.g., at restaurants) were _____________ percent of total U.S. food expenditures spent on all food.

answer

48.9

question

Since 1960, aggregate real income in the U.S. has _______________.

answer

increased

question

To meet the "U.S. No. 1" standard for fresh tomatoes, the tomatoes must be almost perfectly smooth. (T/F)

answer

False

question

Grade standards can be used to categorize food according to how well is prevents cruelty to animals. (T/F)

answer

True

question

When potato seeds get transformed by farmers into potatoes, this transformation is best identified as a __________________ process.

answer

value add

question

In order to give market participants more assurance that the prices they agree to are closer to the competitive ideal, governments ______________________.).

answer

gather and distribute information about market transactions

question

A typical farm-level market for chickens might include chicken farmers selling their chickens to chicken processors. (T/F)

answer

True

question

One reason that the USDA gathers data about commodity production, imports, exports, etc. is to monitor national food security. (T/F)

answer

True

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