The Uniqueness of Agriculture
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Questions and Answers

Which of the following is a reason why agricultural production is unstable from year to year?

  • Weather
  • Pests
  • Diseases
  • All of the above (correct)

    • Why is storage limited for some agricultural products?

  • Perishability of some products
  • Significant cost of storage
  • Both A and B (correct)
  • None of the above

    • What is a consequence of biological lags in production?

  • Production can be sped up or slowed down
  • Production is not affected by time
  • Production is stable year to year
  • None of the above (correct)

    • What is a scarce resource in agriculture that cannot be increased?

    <p>Land</p> Signup and view all the answers

    Why is there limited opportunities for managing supply in agriculture?

    <p>All of the above</p> Signup and view all the answers

    Which of the following is NOT a biological condition affecting agriculture?

    <p>Market conditions</p> Signup and view all the answers

    What is the purpose of storage in agriculture?

    <p>To manage supply</p> Signup and view all the answers

    Which of the following is an example of a product with limited opportunities for reserves?

    <p>Fresh vegetables</p> Signup and view all the answers

    What is the main reason for large annual yield fluctuations in agriculture?

    <p>All of the above</p> Signup and view all the answers

    What is a consequence of the tie to the land in agriculture?

    <p>Increased competition for agricultural resources</p> Signup and view all the answers

    Which factor contributed to the growth in U.S. farm sector output between 1948 and 2017?

    <p>Increase in total factor productivity</p> Signup and view all the answers

    What does Total Factor Productivity (TFP) growth measure?

    <p>The rate of growth of total output</p> Signup and view all the answers

    What does productivity measure in agriculture?

    <p>Changes in the efficiency with which inputs are transformed into outputs</p> Signup and view all the answers

    What can affect measured agricultural productivity in the short term?

    <p>Random events like weather</p> Signup and view all the answers

    What does Total Factor Productivity (TFP) encompass?

    <p>The average productivity of all inputs employed in the production of all crop and livestock commodities</p> Signup and view all the answers

    What is the result of total consumption for agricultural products over time?

    <p>It does not change much</p> Signup and view all the answers

    What is the result of certain products' demand over time?

    <p>It increases significantly</p> Signup and view all the answers

    What is the main reason for the week bargaining power of individual producers in agriculture?

    <p>Relatively homogeneous products</p> Signup and view all the answers

    Why is asset fixity a challenge for farms?

    <p>It is difficult to dispose of capital equipment when downsizing or shutting down the business</p> Signup and view all the answers

    Why is world trade in agricultural products relatively small?

    <p>Trade policy restrictions</p> Signup and view all the answers

    According to the text, what are the four assumptions of the cobweb phenomena?

    <p>i) There is a time lag before production responses to a price change ii) There are no reserves iii) Producers plan their future production based on current prices iv) Market prices are determined by the amount supplied with immediate adoption</p> Signup and view all the answers

    What does the production function show?

    <p>The relationship between quantity of inputs used to make a good and the quantity of that good output</p> Signup and view all the answers

    What are the two types of production functions mentioned in the text?

    <p>Biological and nonbiological production functions</p> Signup and view all the answers

    What does the agricultural (biological) production function measure?

    <p>Quantity of output (bushels corn per acre)</p> Signup and view all the answers

    In a dry year, what is the range of pounds of nitrogen per acre in the typical production function?

    <p>20 to 100</p> Signup and view all the answers

    What are the three special conditions of agriculture mentioned in the text?

    <p>Biological conditions, structural conditions, market conditions</p> Signup and view all the answers

    What is the most correct definition of the cobweb phenomena?

    <p>Cyclical fluctuations in trade and production</p> Signup and view all the answers

    What is the relationship between the quantity of inputs and the quantity of output in a production function?

    <p>The quantity of output increases as the quantity of inputs increases</p> Signup and view all the answers

    What is the correct formula for the non-biological production function?

    <p>$f(x) = 2x$ where $x$ is the quantity of inputs</p> Signup and view all the answers

    What is the correct formula for the agricultural (biological) production function?

    <p>$f(x) = x^2$ where $x$ is the quantity of inputs</p> Signup and view all the answers

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