Vocabulary Section

Price Elasticity of demand for a farm commodity refers to:

• How much the demand curve will shift when there is a change in the price of a quantity

• The percentage change in equilibrium price when there is a given change in market demand

• The percentage change in quantity demanded associated with a given percentage change in price

• The percentage change in total market receipts associated with a certain percentage change in price

Which of the following is not a depreciable asset?

• Purchased breeding stock

• A residence used for hired workers

• A tractor you purchased

• All are depreciable

A fiscal accounting period is one which:

• Covers one year, January - December

• Can be any length that the farmer desires

• Can end on any date of the year

• Is used by the Texas Agricultural office

The ratio that measures the response of a consumption of a good/service in relation to the price of another good or service is called the _____________.

• Comparison Ratio

• Price Elasticity

• Product Differentiation Ratio

• Cross Price Elasticity

Consider two goods, Pork and Beef. The cross-price elasticity of these two goods is _______.

• Negative

• Positive

• Zero

• Not Enough Information Given

A net capital ratio that is _______ indicates that total liabilities are more than total assets and means that the business is solvent.

• Greater than 1

• Less than 1

• Equal to 1

• All of the above

• Deflation

• Taxes

• Tariffs

• Inflation

If a business has working capital greater than $0, its current ratio will be

• Greater than 1

• Less than 1

• Equal to 1

• All of the above

If you are normally a long hedger with traditional futures and you want to hedge with an option, you should:

• Buy a call option

• Sell a call option

• Buy a put option

• Sell a put option

The law of diminishing marginal returns explains ______.

• the shape of the long-run Average Total-Cost Curve

• why all businesses are not profitable

• why average fixed costs decline

• Why short-run Marginal cost increases