1
AGEC 440 Exam 1 Questions with Answers (100%
Correct Answers)
Agribusiness Answer: Agribusiness can be viewed as a number of
interrelated sub sectors which work together formally and informally
to produce goods and services
Formal vs. Informal Answer: - Western world primarily uses contracts
-Eastern world and Latin America use handshakes
(In Asia it is because it has to do with trust and business is kept within
the family usually)
(In Latin America it is because the legal system is corrupt and have
hard time enforcing contracts)
Agribusiness is a ... Answer: System
Driver of the the Agribusiness system Answer: Consumer Sovereignty
Consumer Sovereignty Answer: Overarching principle that impacts
agribusiness system
-desires and needs of consumers control the output of producers
© 2025 All rights reserved
,2
-McDonald's GM Case : banned meat reared on genetically mortified
feed from its hamburgers due to public concerns
Distinctive Characteristics of Agribusiness: Answer: -Food is
intertwined with culture
-Uncertainty underlying biological basis of production
-Political intervention
-Ag and food technology development (public vs. private research)
-Competitive market structure
-Food is a necessity
Food is intertwined with culture, domestically and internationally
Answer: -American's eat turkey on Thanksgiving
-No beef in India
-No pork in the Middle East
-"Meatball War": Sweden, banning pork due to growing Muslim
population, against Danish culture, created social conflict
© 2025 All rights reserved
, 3
Uncertainty underlying biological basis of crop and livestock
production Answer: -Weather
-Food safety
-Disease
-Case of E coli every summer
Political intervention across sub sectors and between nations (US farm
bill) Answer: -Most subsidies go to farmgate level
-Goes back to the biological uncertainty
-Rest of subsidies go to SNAP and WIP
Ag and food technology development (public vs. private research)
Answer: -Transition from mostly government R&D to now mostly
private companies
-Example of a company that spends a lot of time and money on R&D:
Monsanto
-Impacts of Transition: Higher prices for customers
Competitive market structure Answer: -Highly concentrated
© 2025 All rights reserved
AGEC 440 Exam 1 Questions with Answers (100%
Correct Answers)
Agribusiness Answer: Agribusiness can be viewed as a number of
interrelated sub sectors which work together formally and informally
to produce goods and services
Formal vs. Informal Answer: - Western world primarily uses contracts
-Eastern world and Latin America use handshakes
(In Asia it is because it has to do with trust and business is kept within
the family usually)
(In Latin America it is because the legal system is corrupt and have
hard time enforcing contracts)
Agribusiness is a ... Answer: System
Driver of the the Agribusiness system Answer: Consumer Sovereignty
Consumer Sovereignty Answer: Overarching principle that impacts
agribusiness system
-desires and needs of consumers control the output of producers
© 2025 All rights reserved
,2
-McDonald's GM Case : banned meat reared on genetically mortified
feed from its hamburgers due to public concerns
Distinctive Characteristics of Agribusiness: Answer: -Food is
intertwined with culture
-Uncertainty underlying biological basis of production
-Political intervention
-Ag and food technology development (public vs. private research)
-Competitive market structure
-Food is a necessity
Food is intertwined with culture, domestically and internationally
Answer: -American's eat turkey on Thanksgiving
-No beef in India
-No pork in the Middle East
-"Meatball War": Sweden, banning pork due to growing Muslim
population, against Danish culture, created social conflict
© 2025 All rights reserved
, 3
Uncertainty underlying biological basis of crop and livestock
production Answer: -Weather
-Food safety
-Disease
-Case of E coli every summer
Political intervention across sub sectors and between nations (US farm
bill) Answer: -Most subsidies go to farmgate level
-Goes back to the biological uncertainty
-Rest of subsidies go to SNAP and WIP
Ag and food technology development (public vs. private research)
Answer: -Transition from mostly government R&D to now mostly
private companies
-Example of a company that spends a lot of time and money on R&D:
Monsanto
-Impacts of Transition: Higher prices for customers
Competitive market structure Answer: -Highly concentrated
© 2025 All rights reserved
