AgriBusiness – Flashcards
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Farm
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an establishment that has (or should have had) at least $1,000 of sales of agricultural products during the year
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Producers Sector
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those firms engaged in the production of raw food, fiber, and other agricultural products
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Food Product Processors
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buy ingredients and process them into the form in which they are ready for sale to the consumer
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Food Industry
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all firms engaged in the production, processing, and/or distribution of food, fiber, and other agricultural products
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Commodities Processors
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buy raw agricultural products that have not been processed and convert them into food ingredients
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Vertical Integration
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The combination of different businesses of different businesses at different stages of the production/ marketing sequence under a single management
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Coordination
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The communication system that conveys consumer wants to producers
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Concentration
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The dominance of an industry by a few firms, usually measured by the percentage of the total market owned by the largest four firms
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Market Power
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The ability of a firm or firms to control price and/ or quantity traded in a market because of the dominance of the firms in the market
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Globalization
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The expansion of firms across national boundaries
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Concentration among processors is a concern because concentrated firms
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gain market power
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In terms of number of farms, non-family, corporate farms are what proportion of total farms in the United States?
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2%
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The average American farmer produces enough to feed approximately ________ people (both domestic and exports)
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150
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Which of the following is NOT one of the major sectors of the food industry?
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the food sector
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According to the U.S. Department of Agriculture, the number of farms in the United States is approximately
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2 million
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Macroeconomics
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the study of the entire economy, including employment, inflation, international trade, and monetary issues
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Microeconomics of Consumption
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the economics of the individual consumer making decisions about the allocation of the family budget
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Market
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an interaction between potential buyers and sellers
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The study of the behavior of an individual firm is part of
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microeconomics
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Economics
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the social science that deals with the allocation of resources among an unlimited number of competing alternative uses
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Agricultural Economics
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the social science that deals with the allocation of resources among those competing alternative uses found in the production, processing, distribution, and consumption of food and fiber
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The market for beef in the U.S. is an example of allocation using the ________ system
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price
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The economic term used to describe the earnings forgone by attending college is
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opportunity cost
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In the language of economics, which of the following is a "resource"?
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water,pick-up trucks,wheat,labor
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When a local McDonald's manager hired a third counter worker her sales increased by 22%. When she hired a fourth counter worker, her sales increased by 12%. This is an example of
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diminishing returns
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Ceteris Paribus
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a short had way of saying "let one economic variable change and see how another economic variable changes assuming everything else stays the same."
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Opportunity Cost
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a measure of how much of an earning opportunity is foregone by using a resource in its current employment
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Price Taker
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potential buyers and sellers in a perfectly competitive market who face a "take it or leave it" situation
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Marginal
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an additional or incremental unit of something
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Efficient
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a general concept used in a variety of situations measuring output per unit of input. The higher the ratio the more efficient the process.
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Decreasing Marginal Returns
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As additional units of a variable input are used, output increases at an decreasing rate.
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Increasing Returns to Scale
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As the size of inputs increases, outputs increase by a proportionately greater amount
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Decreasing Returns to Scale
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As the size of inputs increases, outputs increase by a proportionately lesser amount
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Negative Marginal Returns
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As additional units of a variable input are used, output decreases.
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Constant Return to Scale
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As the size of inputs increases, outputs increase by the same amount
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Law of Diminishing Marginal Product
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as equal increments of the variable input are added to the fixed inputs, there will inevitably occur a decrease in the rate of increase of the total product.
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Increasing Marginal Returns
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As additional units of a variable input are used, output increases at an increasing rate.
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Fixed Input
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those inputs for which the use rate does not change as the level of output change
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Short Run
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a time period in which some factors of production are fixed
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Long Run
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a period of time in which all resources are variable.
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Accounting Profit
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the difference between revenue earned and expenses incurred
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Variable Input
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those inputs for which the use rate does change as the level of output changes.
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Economic Profit
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the difference between all revenue and all input costs, whether actually paid or not.
