Exam 22: Agriculture: Economics and Policy

Public choice theory would suggest that the lobbying of Congress by farm organizations for legislation that would increase the appropriations from the U.S. government for agricultural programs is an example of

The misallocation of resources associated with price supports

Due to high fixed costs relative to variable costs in farming, farm production is quite sensitive to price changes in the short run.

Ward Planter exclusively grew soybeans from 2011 to 2013 and participated in the marketing loan program of the Food, Conservation, and Energy Act of 2008. If the "crop price" of soybeans at harvest was less than the preharvest "loan price," Planter could

Refer to the graph of the supply and demand for agricultural products. Which of the following best describes the long-run decline of the U.S. agricultural industry?

A source of demand volatility for agricultural products is

A declining parity ratio implies that the

Incomes of U.S. farmers are adversely affected by

Refer to the diagram. If output changes from a poor crop, Qₚ , to a bumper crop, Qᵦ ,

Which of the following statements is correct?

The farm price-support programs hurt consumers of the farm products, and moreover, the burden tends to be disproportionately heavier on the low-income consumers.

Refer to the graph of the market for wheat. The government adopts a price support program for wheat and supports the wheat price at P ₂. The area of Q ₁ ABQ ₂ would measure the

What is the Conservation Reserve Program? Comment on the program's effectiveness.

Refer to the demand graph for a farm product. Which of the following will cause the largest decrease in farmers' incomes?

The Food, Conservation, and Energy Act of 2008

The price of a certain farm product was $2.00 in the base period when the parity ratio was 100. If the index of prices paid by farmers is now at 130, then the parity price of this farm product today should be

Which of the following statements about U.S. farm exports as a percentage of farm output is false?

Refer to the graph of the supply and demand for agricultural products. If point 1 reflects the supply and demand for agricultural products in the U.S. in the 1950s, then which point would best characterize long-run change in the equilibrium for agricultural products since that time?

Which of the following statements describes how a price-change in a purely competitive market would eliminate the surplus of an agricultural commodity?

If the parity ratio goes from 1 to 0.8, it means that the prices received by farmers had