Question 1

If the demand curve for agricultural products is inelastic and farmers as a group become more productive,then prices of agricultural goods will __________ and total revenue earned by farmers will __________.
A) decrease;increase
B) decrease;decrease
C) increase;increase
D) increase;decrease
E) We cannot answer this question without knowing how inelastic the demand curve is.

Accepted Answer

B

Question 2

In 2000,farmers in the United States represented approximately what percentage of the population?
A) 8 percent
B) 25 percent
C) 1 percent
D) 5 percent

Accepted Answer

According to the United States Department of Agriculture, in 2000, farmers represented approximately 1 percent of the total US population.

Question 3

Suppose iceberg lettuce has an income elasticity of demand of 0.35.A 10 percent increase in income causes the quantity demanded of iceberg lettuce to _______________ by ______________ percent.
A) rise;3.5
B) rise;28.57
C) fall;28.57
D) fall;3.5

Accepted Answer

If the income elasticity of demand for iceberg lettuce is 0.35, a 10% increase in income will lead to a 3.5% increase in the quantity demanded of iceberg lettuce. Therefore, the answer is A.

Question 4

Evidence seems to indicate that the demand for many agricultural products
A) has increased much more than supply over the years.
B) is relatively elastic.
C) is relatively inelastic.
D) is relatively income elastic.
E) b and d

Accepted Answer

The word "indicating" suggests that there is some evidence in the text that supports a specific answer. The only option that is directly supported by the text is that the demand for agricultural products is "relatively inelastic." The other options are not mentioned in the text or are not supported by the evidence provided.

Question 5

Studies show that as real income has been rising in the United States,the per-capita demand for food has been increasing by
A) much less,which means the demand for food is income inelastic.
B) much more,which means the demand for food is income elastic.
C) much more,which means the demand for food is income inelastic.
D) as much,which means the demand for food is unit elastic.
E) none of the above

Accepted Answer

The answer of Studies show that as real income has...

Question 6

Suppose farmers get together and decide to be less productive.They want to do this so that they can shift the supply curve of farm products leftward and raise the price.They must be assuming that the demand curve between the current price and the higher price is
A) inelastic.
B) elastic.
C) unit elastic.
D) There is not enough information to answer this question.

Accepted Answer

Farmers assume that the demand curve is inelastic because they think that the quantity demanded will not decrease significantly in response to the price increase caused by the leftward shift in the supply curve. Otherwise, if the demand curve were elastic, the price increase would cause a greater decrease in quantity demanded, making it difficult for farmers to achieve their goal of increasing revenue.

Question 7

Suppose farmers get together and decide to be less productive.They want to do this so that they can shift the supply curve of farm products leftward and raise the price.What are the thoughts of a profit-maximizing farmer most likely to be once this agreement has been made?
A) If I break the agreement while everyone else holds to it,I can make myself better off.
B) I am happy that we decided to be unproductive;I can't be unproductive by myself.
C) I will definitely hold to the agreement.
D) Everyone will break the agreement but me.

Accepted Answer

A profit-maximizing farmer would most likely think about breaking the agreement to make themselves better off. By reducing their productivity, they are likely to face lower revenues and profits, which can be avoided by producing more than what others agreed on. Hence, option A is the best choice.

Question 8

Increased productivity in the agricultural sector is not always a benefit to farmers because it is accompanied by
A) lower prices and if demand is inelastic,lower prices mean lower revenues.
B) higher prices and if demand is elastic,higher prices mean lower revenues.
C) lower prices and if demand is elastic,lower prices mean lower revenues.
D) higher prices and if demand is inelastic,higher prices mean lower revenues.

Accepted Answer

The answer of Increased productivity in the agricultural sector is...

Question 9

If the demand for a particular farm product is inelastic between price P₁ and P₂ (where P₂ > P₁),farmers as a group would want to sell their product at the A) higher price,but an individual farmer would rather sell his product at the lower price. B) higher price,and an individual farmer would rather sell his product at the higher price,too. C) lower price,but an individual farmer would rather sell his product at the higher price. D) lower price,and an individual farmer would rather sell his product at the lower price,too.

Accepted Answer

If the demand for a particular farm product is inelastic, it means that a change in price has a relatively small effect on the quantity demanded. Therefore, if the price increases, the total revenue (price multiplied by quantity) for farmers as a group would increase as well. An individual farmer would also prefer to sell their product at the higher price because it would result in more profit per unit sold. Therefore, both farmers as a group and individually would want to sell their product at the higher price.

Question 10

Which of the following statements is true?
A) Bad weather isn't always that bad for farmers' incomes.
B) An individual farmer would probably increase his revenues if he experienced good weather and other farmers experienced bad weather.
C) Price elasticity of demand is a relevant factor to a farmer's income.
D) a and b
E) a,b,and c

Accepted Answer

The answer of Which of the following statements is true?
A)...

Question 11

During much of the 20th century,agricultural product prices
A) rose relative to other prices.
B) fell relative to other prices.
C) neither rose nor fell relative to other prices.
D) rose as agricultural productivity increased.

Accepted Answer

Agricultural product prices fell relative to other prices during much of the 20th century due to increased productivity and technological advancements in agriculture.

Question 12

If the demand curve for agricultural products is inelastic,then it would be in the best interest of farmers as a group to
A) increase output and thereby receive greater revenues.
B) cause the price of their product to decrease.
C) find some way to decrease the quantities of output that are placed on the market for sale.
D) petition the government to find a way to decrease the demand for their product.
E) a and b

Accepted Answer

The answer of If the demand curve for agricultural products...

Question 13

During the twentieth century,the U.S.farm sector experienced
A) large increases in its ability to produce output.
B) relatively little improvement in its ability to produce output.
C) a marked decrease in its ability to produce output.
D) relatively stable demand for its output.
E) increasing relative prices for its output.

Accepted Answer

With technological advances and mechanization, the U.S. farm sector experienced large increases in its ability to produce output during the twentieth century.

Question 14

With a price elasticity of demand of 0.45,when the price of soybeans falls by 10 percent,the quantity demanded of soybeans rises by approximately _____________ percent.
A) 4.50
B) 45.0
C) 0.45
D) 0.56

Accepted Answer

The answer of With a price elasticity of demand of...

Question 15

If the demand curve for agricultural products is elastic and farmers as a group become more productive,then prices of agricultural goods will __________ and total revenue earned by farmers will __________.
A) decrease;increase
B) decrease;decrease
C) increase;increase
D) increase;decrease
E) We cannot answer this question without knowing how elastic the demand curve is.

Accepted Answer

The answer of If the demand curve for agricultural products...

Question 16

Studies show that,in the United States,
A) price elasticity of demand for agricultural products has hovered around 3.2 for many years.
B) as real income has been increasing,the per-capita demand for food has been decreasing.
C) as real income has been increasing,the per-capita demand for food has been increasing by much more.
D) none of the above

Accepted Answer

The answer of Studies show that,in the United States,
A) price...

Question 17

If we assume that the income elasticity of demand for food has been around 0.2 and that agricultural producers have become increasingly more productive,we can conclude that
A) prices of food have increased.
B) supply increases have been less than demand decreases.
C) as consumers' real incomes have been increasing over the years,they have been spending absolutely less on food.
D) prices of food have been stable.
E) none of the above

Accepted Answer

The answer of If we assume that the income elasticity...

Question 18

Increased productivity in the agricultural sector during much of the twentieth century shifted the
A) demand curve for farm products rightward.
B) supply curve of farm products leftward.
C) demand curve for farm products leftward.
D) supply curve of farm products rightward.

Accepted Answer

Increased productivity in the agricultural sector means more goods can be produced at each price level, which leads to a rightward shift in the supply curve.

Question 19

Suppose the price elasticity of demand of for soy beans is 0.85.When the price of soybeans rises by 20 percent,the quantity demanded of soybeans falls by approximately _____________ percent.
A) 0.024
B) 26.67
C) 23.53
D) 17.00

Accepted Answer

The answer of Suppose the price elasticity of demand of...

Question 20

Which of the following best describes the agricultural sector for much of the 20th century and today?
A) high productivity,price elasticity of demand less than 1,income elasticity of demand greater than 1
B) low productivity,price elasticity of demand greater than 1,income elasticity of demand less than 1
C) high productivity,price elasticity of demand less than 1,income elasticity of demand less than 1
D) low productivity,price elasticity of demand less than 1,income elasticity of demand greater than 1

Accepted Answer

The agricultural sector has experienced significant increases in productivity due to advancements in technology and farming practices. However, the demand for agricultural products is relatively inelastic, meaning that changes in price have little effect on the quantity demanded, and the income elasticity of demand is also relatively low, indicating that as consumer incomes increase, the demand for agricultural products does not increase at the same rate. Therefore, choice C, high productivity, price elasticity of demand less than 1, income elasticity of demand less than 1, best describes the agricultural sector for much of the 20th century and today.

Quiz 27: Agriculture: Problems, policies, and Unintended Effects

If the demand curve for agricultural products is inelastic and farmers as a group become more productive,then prices of agricultural goods will and total revenue earned by farmers will .

In 2000,farmers in the United States represented approximately what percentage of the population?

Suppose iceberg lettuce has an income elasticity of demand of 0.35.A 10 percent increase in income causes the quantity demanded of iceberg lettuce to _ by percent.

Evidence seems to indicate that the demand for many agricultural products

Studies show that as real income has been rising in the United States,the per-capita demand for food has been increasing by

Suppose farmers get together and decide to be less productive.They want to do this so that they can shift the supply curve of farm products leftward and raise the price.They must be assuming that the demand curve between the current price and the higher price is

Suppose farmers get together and decide to be less productive.They want to do this so that they can shift the supply curve of farm products leftward and raise the price.What are the thoughts of a profit-maximizing farmer most likely to be once this agreement has been made?

Increased productivity in the agricultural sector is not always a benefit to farmers because it is accompanied by

If the demand for a particular farm product is inelastic between price P₁ and P₂ (where P₂ > P₁) ,farmers as a group would want to sell their product at the

Which of the following statements is true?

During much of the 20th century,agricultural product prices

If the demand curve for agricultural products is inelastic,then it would be in the best interest of farmers as a group to

During the twentieth century,the U.S.farm sector experienced

With a price elasticity of demand of 0.45,when the price of soybeans falls by 10 percent,the quantity demanded of soybeans rises by approximately _____________ percent.

If the demand curve for agricultural products is elastic and farmers as a group become more productive,then prices of agricultural goods will and total revenue earned by farmers will .

Studies show that,in the United States,

If we assume that the income elasticity of demand for food has been around 0.2 and that agricultural producers have become increasingly more productive,we can conclude that

Increased productivity in the agricultural sector during much of the twentieth century shifted the

Suppose the price elasticity of demand of for soy beans is 0.85.When the price of soybeans rises by 20 percent,the quantity demanded of soybeans falls by approximately _____________ percent.

Which of the following best describes the agricultural sector for much of the 20th century and today?