Farm and ranch management exam 2
material well answered
If the marginal physical product decreases as additional input is used, the marginal cost will be
a. increasing
b. decreasing
c. constant
d. could be any of these - correct answer ✔✔a. increasing
Cattle on feed should be marketed when
a. their average cost of gain is no longer below their selling price.
b. their marginal cost of gain is no longer below their selling price.
c. their marginal cost of gain is no longer below their original purchase price.
d. they have reached their maximum weight. - correct answer ✔✔b. their marginal cost of gain
is no longer below their selling price
A production function shows the amount of physical product obtained with different
a. levels of input.
b. output prices.
c. input prices.
d. ratios of input and output prices. - correct answer ✔✔a. levels of input
The equation for computing marginal cost is
,a. total cost divided by output.
b. total cost divided by input.
c. change in total cost divided by change in input.
d. change in total cost divided by change in output. - correct answer ✔✔d. change in total cost
divided by change in output
If a farmer is producing at some point where MR is greater than MC and the amount of input
available is not limited
a. profit is not being maximized.
b. more input should be used to maximize profit.
c. more output should be produced to maximize profit.
d. all of these - correct answer ✔✔d. all of these
If MPP is less than APP, then APP
a. is decreasing.
b. is increasing.
c. is constant.
d. may be doing any of these. - correct answer ✔✔a. is decreasing
If the purchase price of an input decreases, a profit maximizing farmer should
a. use more input and produce more output.
b. use more input and produce less output.
c. use less input and produce more output.
,d. use less input and produce less output. - correct answer ✔✔a. use more input and produce
more output
The Equal Marginal principle should be used whenever
a. inputs are available in unlimited quantity.
b. there is only one possible use for an input.
c. there is a limited amount of input available and several alternative uses for it.
d. a farmer wishes to maximize profit from one enterprise. - correct answer ✔✔c. there is a
limited amount of input available and several alternative uses for it
The "law of diminishing marginal returns" means that as the level of input is increased
a. the product selling price decreases.
b. the amount of product produced increases faster than the amount of input used.
c. the amount of product produced increases at the same rate as the amount of input used.
d. the amount of product produced increases more slowly than the amount of input used. -
correct answer ✔✔d. the amount of product produced increases more slowly than the amount
of input used
Marginal value product (MVP) and marginal input cost (MIC) are measured in terms of
a. $ per unit of output.
b. $ per unit of input.
c. physical output units.
d. physical input units. - correct answer ✔✔b. $ per unit of input
, Marginal revenue (MR) and marginal cost (MC) are measured in terms of
a. $ per unit of output.
b. $ per unit of input.
c. physical output units.
d. physical input units. - correct answer ✔✔a. $ per unit of output
When an input is being used at its profit maximizing level, the marginal physical product
generated at that level will be equal to what ratio?
a. unit price of the output divided by the unit price of the input
b. unit price of the input divided by the unit price of the output
c. total quantity of output divided by total quantity of input at that level
d. change in total revenue divided by the change in total physical product - correct answer
✔✔b. unit price of the input divided by the unit price of the output
As feeder livestock reach higher and higher weights, the marginal revenue (selling price per
pound) received from selling them (ignoring market volatility) often
a. remains constant.
b. begins to increase.
c. begins to decrease, but does not reach zero.
d. reaches zero. - correct answer ✔✔c. begins to decrease, but does not reach zero
Marginal value product (MVP) and marginal input cost (MIC) are measured in terms of
a. $ per unit of output.
material well answered
If the marginal physical product decreases as additional input is used, the marginal cost will be
a. increasing
b. decreasing
c. constant
d. could be any of these - correct answer ✔✔a. increasing
Cattle on feed should be marketed when
a. their average cost of gain is no longer below their selling price.
b. their marginal cost of gain is no longer below their selling price.
c. their marginal cost of gain is no longer below their original purchase price.
d. they have reached their maximum weight. - correct answer ✔✔b. their marginal cost of gain
is no longer below their selling price
A production function shows the amount of physical product obtained with different
a. levels of input.
b. output prices.
c. input prices.
d. ratios of input and output prices. - correct answer ✔✔a. levels of input
The equation for computing marginal cost is
,a. total cost divided by output.
b. total cost divided by input.
c. change in total cost divided by change in input.
d. change in total cost divided by change in output. - correct answer ✔✔d. change in total cost
divided by change in output
If a farmer is producing at some point where MR is greater than MC and the amount of input
available is not limited
a. profit is not being maximized.
b. more input should be used to maximize profit.
c. more output should be produced to maximize profit.
d. all of these - correct answer ✔✔d. all of these
If MPP is less than APP, then APP
a. is decreasing.
b. is increasing.
c. is constant.
d. may be doing any of these. - correct answer ✔✔a. is decreasing
If the purchase price of an input decreases, a profit maximizing farmer should
a. use more input and produce more output.
b. use more input and produce less output.
c. use less input and produce more output.
,d. use less input and produce less output. - correct answer ✔✔a. use more input and produce
more output
The Equal Marginal principle should be used whenever
a. inputs are available in unlimited quantity.
b. there is only one possible use for an input.
c. there is a limited amount of input available and several alternative uses for it.
d. a farmer wishes to maximize profit from one enterprise. - correct answer ✔✔c. there is a
limited amount of input available and several alternative uses for it
The "law of diminishing marginal returns" means that as the level of input is increased
a. the product selling price decreases.
b. the amount of product produced increases faster than the amount of input used.
c. the amount of product produced increases at the same rate as the amount of input used.
d. the amount of product produced increases more slowly than the amount of input used. -
correct answer ✔✔d. the amount of product produced increases more slowly than the amount
of input used
Marginal value product (MVP) and marginal input cost (MIC) are measured in terms of
a. $ per unit of output.
b. $ per unit of input.
c. physical output units.
d. physical input units. - correct answer ✔✔b. $ per unit of input
, Marginal revenue (MR) and marginal cost (MC) are measured in terms of
a. $ per unit of output.
b. $ per unit of input.
c. physical output units.
d. physical input units. - correct answer ✔✔a. $ per unit of output
When an input is being used at its profit maximizing level, the marginal physical product
generated at that level will be equal to what ratio?
a. unit price of the output divided by the unit price of the input
b. unit price of the input divided by the unit price of the output
c. total quantity of output divided by total quantity of input at that level
d. change in total revenue divided by the change in total physical product - correct answer
✔✔b. unit price of the input divided by the unit price of the output
As feeder livestock reach higher and higher weights, the marginal revenue (selling price per
pound) received from selling them (ignoring market volatility) often
a. remains constant.
b. begins to increase.
c. begins to decrease, but does not reach zero.
d. reaches zero. - correct answer ✔✔c. begins to decrease, but does not reach zero
Marginal value product (MVP) and marginal input cost (MIC) are measured in terms of
a. $ per unit of output.
