Test Bank For Principles of Agricultural Economics, 4E By Andrew Barkley, Paul W. Barkley Chapter 1-16 CHAPTER 1 1-1. All graphs must include the following on each axis: A. functions and units B. labels and units C. functions and labels D. functions, labels, and units 1-2. Garbage is an example of: A. an economic good B. a noneconomic good C. a scarce good D. a mixed good 1-3. All real-world economies are: A. market B. command C. mixed D. none of the other answers 1-4. Since World War II, US agriculture has been characterized by: A. massive consolidation of farms B. massive substitution of machines and chemicals for workers C. increasing exports of US agricultural products D. all of the other answers 1-5. Economics is: A. universally loved, since it allows us to maximize our happiness B. is all about making good decisions in our careers and lives C. the allocation of scarce resources among non-competitive ends D. the dollar value of the national output of goods and services 1-6. A consumer is: A. a household B. a buyer C. a customer D. all of the other answers 1-7. The statement, "The price of wheat should be higher" is an example of: A. positive economics B. normative economics
C. microeconomics D. macroeconomics 1-8. An economic good is always: A. scarce B. free C. neither scarce nor free D. both scarce and free 1-9. Total revenues for a business firm in the US are equal to: A. PQ B. P + Q C. PQ + P D. none of the other answers 1-10. A producer is: A. an individual who makes a good or service B. a firm that produces a product C. a business firm that makes a good and sells it to maximize profits D. all of the other answers 1-11. The statement, "Michael Phelps is the greatest athlete of all times" is an example of: A. positive economics B. normative economics C. microeconomics D. macroeconomics 1-12. The equation of a line, y = b+mx: A. m is the y-intercept B. b is the x-intercept C. m is the slope D. not enough information to know 1-13. The payment to capital is: A. land B. profit C. interest D. rent 1-14. An Iowa corn producer who has studied economics will desire to: A. maximize output B. apply the output-maximizing level of fertilizer C. use the profit-maximizing level of all inputs, including fertilizer D. not use fertilizer, since the cost has increased so dramatically 1-15. If the price of corn increases:
A. producers are made better off B. consumers are made better off C. producers and consumers are made better off D. producers benefit, but consumers lose 1-16. In economics, the term, "capital" refers to: A. financial capital only B. physical and financial capital C. physical capital only D. it depends on the situation 1-17. The statement, "The price of soybeans is $8.21/bu" is an example of: A. positive economics B. normative economics C. microeconomics D. macroeconomics 1-18. Economic decisions are made by: A. relative prices B. absolute prices C. constant-quality prices D. economic prices 1-19. A market economy: A. allocates good by prices B. allocates goods by firms C. bases decisions on what is good for everybody D. a democratic nation 1-20. Scarcity: A. is the fundamental principle of economics B. applies to tangible goods, but not to intangible goods C. does not hold for the major religions of the world D. explains why we purchase ipods and trips to Florida 1-21. If China continues to have high rates of economic growth, then the following groups will benefit: A. US farmers B. US ranchers C. US farmers and ranchers D. neither US farmers nor ranchers 1-22. The relationship between the price of a good and the quantity of a good consumed is: A. depends on the situation B. inverse C. direct
D. unknown 1-23. Total Revenues are equal to: A. price times quantity in terms of dollars B. price times rent C. net profit D. the amount of costs that a business firm incurs 1-24. If the price of organic food decreases relative to food produced with chemicals, then: A. farmers will plant more acres to organic and conventional food B. farmers will plant more acres to organic food C. farmers will plant more acres to conventional food D. farmers will continue to grow what they always have 1-25. A phone call is an example of a: A. relative good B. good C. service D. input 1-26. North Korea is an example of a: A. market economy B. command economy C. mixed economy D. an “Asian Tiger,” a rapidly growing economy 1-27. Economics exists because of: A. markets B. resources C. production D. scarcity 1-28. Economics: A. helps us make business, career, and personal decisions B. provides a tool to choose between alternatives C. both of the above D. neither of the above 1-29. In a command economy, resources are allocated by: A. prices and returns B. elected officials C. the dictator D. whoever is in charge 1-30. The massive consolidation of farms in the US is due to: A. substitution of K for L
B. exports C. increases in the standard of living D. off-farm income 1-31. Microeconomics concerns: A. the decisions of individual firms and households B. economic growth C. little, or small, economic decisions D. unemployment and inflation 1-32. The statement, "Gambling is legal in Nevada" is an example of: A. positive Economics B. normative Economics C. prescriptive Economics D. microeconomics 1-33. Scarcity is the fundamental concept of economics because: A. consumption is greater than production B. it forces us to choose C. the Law of Diminishing Returns D. necessities such as food and water are widely available 1-34. Suppose that the demand for hamburgers in Chicago is given by: P = 100 - 2Q. The yintercept of the demand curve is given by: A. 50 B. 100 C. 2 D. 1 1-35. The term, ceteris paribus, in economics means: A. prices are fixed and constant B. a graph has only two variables in it C. holding all else constant D. equilibrium 1-36. The payment to land is: A. rent B. profit C. revenues D. interest 1-37. The US is an example of: A. a market economy B. a mixed economy C. a command economy D. none of the above