Which of the following best describes the short-run problem faced by farms?
A. New technology has increased the productivity of farmers and therefore resulted in
declining farm prices and low farm incomes.
B. The highly inelastic nature of agricultural demand, together with fluctuations in exports of
farm goods, has caused small year-to-year fluctuations in farm output to result in highly
unstable farm incomes.
C. The supply of farm products has increased relative to the demand for them, and because
demand is inelastic, prices of farm output and farm income have therefore declined.
D. The demand for farm products has increased relative to their supply, but the elastic nature
of agricultural demand has caused these shifts to result in declining farm incomes.
Answer: B
You might also like to view...
Refer to Figure 5-9. An efficient way to get the firm to produce the socially optimal output level is
A) to grant a subsidy to enable the industry to internalize the external costs of production. B) to assign property rights to the firms in the industry. C) to impose a tax to make the industry bear the external costs it creates. D) for government to set a quota on the quantity of toilet paper that the toilet paper industry can produce.
About what percentage of the goods and services purchased by U.S. consumers, businesses, and governments in 2012 were produced by foreigners?
A) 5% B) 14% C) 18% D) 40%
Refer to the game between James and Theodore depicted in Figure 12.1. Which of the following is true?
A. James's dominant strategy is to choose Up.
B. James's dominant strategy is to choose Down.
C. Theodore's dominant strategy is to choose Left.
D. Theodore's dominant strategy is to choose Right.
People tend to wait until deadlines get close to work on projects in part because they believe that they can complete the projects in less time than it will actually take. Which findings from behavioral economics is this observation consistent with?
a. People tend to be time inconsistent and people tend to be overconfident. b. People tend to be time inconsistent but not that people tend to be overconfident. c. People tend to be overconfident, but not that people tend to be time inconsistent. d. Neither that people tend to be overconfident nor that people tend to be time inconsistent.