Download 2008D-MC-Non-Math - Mid

Farm Management
2008 MC Non-Math
7.
The own-price elasticity of supply estimates the impact on the quantity of
a good supplied by a change in the price of the good. Normally, one would
expect the own-price elasticity of supply to be
A.
B.
C.
D.
• a
positive.
negative.
zero.
None of the above
8.
The term "exchange rate" refers to
A. how much of one currency is needed to acquire a unit of another
currency.
B. how much principal is reduced by payments on an amortized loan.
C. the ratio between current and long-term debt.
D. the difference in value between a dollar today and a dollar one year from
today.
E. None of the above
• a
9.
A procedure for expressing future cash flows in today's
A.
B.
C.
D.
E.
• b
compounding.
discounting.
deflating.
inflating.
None of the above
dollars is called
12.
For an amortized loan, the present value of the loan
at the loan's interest rate is equal to
A.
B.
C.
D.
E.
• a
payments discounted
the amount of money borrowed.
the number of payments times the payment amount.
total interest paid over the life of the loan.
the size of the annual payment.
None of the above
17.
A hectare equals
A.
B.
C.
D.
E.
• c
0.40 acres
1.74 acres
2.47 acres
5.05 acres
None of the above
22.
A farmer is "liquid" if
A.
B.
C.
D.
E.
• a
he has sufficient current assets to cover current debts.
he has sufficient equity to cover current debts.
he has sufficient assets to cover all debts.
he can pay all debts with all equity.
All of the above
25.
When a farmer borrows money to purchase land, he usually must offer the
title to the property as security until the debt has been repaid. This credit
instrument is commonly referred to as a
A.
B.
C.
D.
E.
• c
sales contract.
promissory note.
mortgage.
check.
None of the above
26.
A decline in the value of total farm assets will
A.
B.
C.
D.
E.
• d
increase the rate of return to equity.
increase the rate of return to assets.
increase the capital turnover ratio.
all of the above.
None of the above
27.
The increase in wheat yield becomes smaller for each additional 10 pounds
of nitrogen fertilizer applied after 30 pounds per acre have been applied.
This is an example of
A.
B.
C.
D.
E.
• c
increasing marginal returns.
unprofitable use of fertilizer.
diminishing marginal physical product.
stage 3 of production.
None of the above
28.
Which of the following causes a shift in the demand for beef?
A.
B.
C.
D.
E.
• d
A decrease in cattle numbers
Increased cost of producing beef
Increased number of cattle producers
Increased income of consumers
All of the above
29.
The cost of producing one additional unit of output is called
A.
B.
C.
D.
E.
• d
opportunity cost.
substitution cost.
average cost.
marginal cost.
None of the above
31.
• c
Purchase of a Call option on corn means the buyer
A. is required to sell a corn futures contract at a set price.
B. may sell, but is not required to sell, a corn futures contract at a set price.
C. may buy, but is not required to buy, a corn futures contract at a set price.
D. is required to buy a corn futures contract at a set price.
E. None of the above
32.
If the price of a September Put option is higher today than yesterday, then
one would expect that the price of a September futures contract is
A. higher today than yesterday.
B. lower today than yesterday.
C. unchanged from yesterday.
D. either up or down. There is no relationship between futures prices
and prices of options.
E. None of the above
• b
35.
A firm should shut down in the short-run if it cannot
A.
B.
C.
D.
E.
• c
fixed costs.
total costs.
variable costs.
time costs.
overhead costs
cover its
36.
The price of widgets changes from $60 to $50 and, as a result, the quantity demanded
increases from 90 to 100 units. From this we can conclude that
A.
B.
C.
D.
E.
• b
the demand for widgets is elastic.
the demand for widgets is inelastic.
the demand for widgets is of unit elasticity.
the demand for widgets has declined.
None of the above
38.
If the total cost of producing 100 units of output is $500 and the average
variable cost is equal to $1, then which of the following statements is true?
A.
B.
C.
D.
E.
• c
Total variable cost of the 100 units is $400.
Total fixed cost is equal to $100.
Average fixed cost is equal to $4.
Average total cost is equal to $4.
None of the above is true.
40.
How many bushels of corn are in a metric ton?
A.
B.
C.
D.
E.
• d
33.3
35.7
36.7
39.4
None of the above