A main advantage of product diversification is
Answer: to spread rixk and stablize income
In a partnership each partner can be held responsible
In a partnership each partner can be held responsible
Answer: for the total debts
Most partnership divisions and terminations are caused by
Most partnership divisions and terminations are caused by
Answer: disagreement over trivial matters
The most common legal structure of a farm business is the.
The most common legal structure of a farm business is the.
Answer: sole proprietorship
Which type life insurance gives maximum protection at the least cost?
Which type life insurance gives maximum protection at the least cost?
Answer: term
The price of soybeans on the futures market could not fall from $6.00 to $1.00 during a single trading session because of the .
The price of soybeans on the futures market could not fall from $6.00 to $1.00 during a single trading session because of the .
Answer: trading limit
I sold my old worn out tractor I had used for twenty years for $300.00. This is the .
I sold my old worn out tractor I had used for twenty years for $300.00. This is the .
Answer: salvage value
From which of the following can you make the best determination as to the financial status of a person?
From which of the following can you make the best determination as to the financial status of a person?
Answer: his net worth
If the price and consumption of beef goes up then the demand for beef must be .
If the price and consumption of beef goes up then the demand for beef must be .
Answer: up
The financial returns after all costs have been paid is called .
The financial returns after all costs have been paid is called .
Answer: net returns
The processes and services involved in moving a commodity from the producer to the ultimate consumer is called
The processes and services involved in moving a commodity from the producer to the ultimate consumer is called
Answer: marketing
If demand rises and supply remains constant, price should?
If demand rises and supply remains constant, price should?
Answer: rise
A person goes to the bank to secure a loan to finance a greenhouse operation. He say's "I don't have the money to start this by myself, I need more ."
A person goes to the bank to secure a loan to finance a greenhouse operation. He say's "I don't have the money to start this by myself, I need more ."
Answer: capital
An estimate of costs and returns associated with a particular enterprise is a/an
An estimate of costs and returns associated with a particular enterprise is a/an
Answer: budget
The bank officer will appraise my farm. This means he/she will:
The bank officer will appraise my farm. This means he/she will:
Answer: estimate its fair market value
Thomas is a poultry producer for Gold Kist. I can purchase all the dressed chickens (originally from Thomas's farm) my family needs at the supermarket cheaper than I can raise and dress them myself. This can be explained by the theory
Thomas is a poultry producer for Gold Kist. I can purchase all the dressed chickens (originally from Thomas's farm) my family needs at the supermarket cheaper than I can raise and dress them myself. This can be explained by the theory
Answer: economies of scale
Who is at the greatest risk?
Who is at the greatest risk?
Answer: the third mortgage holder
Which is considered a fixed asset?
Which is considered a fixed asset?
Answer: land
Joe's total cost for his strawberry operation this year was $800.00. If his gross receipts totaled $2,400.00, what was his percent return to investment?
Joe's total cost for his strawberry operation this year was $800.00. If his gross receipts totaled $2,400.00, what was his percent return to investment?
Answer: 50
A friend borrows $2,000 and agrees to repay you at the end of three months. The interest is to be calculated at 12% per year compounded monthly. What is the total amount he/she will owe at repayment time?
A friend borrows $2,000 and agrees to repay you at the end of three months. The interest is to be calculated at 12% per year compounded monthly. What is the total amount he/she will owe at repayment time?
Answer: $2,60.60
At what age will term life insurance cost a person the most?
At what age will term life insurance cost a person the most?
Answer: 55 years
The people below have their current ratio of assets to liabilities listed beside their name. Based solely on this ratio which would you most likely lend money to?
The people below have their current ratio of assets to liabilities listed beside their name. Based solely on this ratio which would you most likely lend money to?
Answer: Thomas 6:1
A good reason for keeping good records is
A good reason for keeping good records is
Answer: All of the answers listed
Johnny was listing his assets for a bank loan. Which item below should be listed with his assets?
Johnny was listing his assets for a bank loan. Which item below should be listed with his assets?
Answer: farm truck
Which is not a likely source of funds for short term (less than three years) loans?
Which is not a likely source of funds for short term (less than three years) loans?
Answer: Federal land bank
Which of the following is a commodity traded on the futures market?
Which of the following is a commodity traded on the futures market?
Answer: hogs
The is designed to prevent sudden drastic price declines or rises in the futures market
The is designed to prevent sudden drastic price declines or rises in the futures market
Answer: trading limit
The total quantity of goods and services that buyers are willing and able to buy at various prices at a given time is called .
The total quantity of goods and services that buyers are willing and able to buy at various prices at a given time is called .
Answer: demand
Interest rates are determined by the
Interest rates are determined by the
Answer: savers and borrowers interacting in the money market
If a producer had an opportunity to choose the amount of the payment on his long term loans, which would he use to determine the amount he could pay?
If a producer had an opportunity to choose the amount of the payment on his long term loans, which would he use to determine the amount he could pay?
Answer: net income
Thomas needs to borrow money to produce a crop of strawberries. Of the following choices, Is the most logical source.
Thomas needs to borrow money to produce a crop of strawberries. Of the following choices, Is the most logical source.
Answer: Production Credit Association
What item could be used as collateral to secure operating capital?
What item could be used as collateral to secure operating capital?
Answer: machinery
Which item is not a tax deductible expense?
Which item is not a tax deductible expense?
Answer: Principle payment for the family car
A farmer's income tax should be filed no later than provided he has filed his estimated tax by Jan. 15th.
A farmer's income tax should be filed no later than provided he has filed his estimated tax by Jan. 15th.
Answer: April 15
A rise in the price of all the following materials would change the demand for which of the materials least?
A rise in the price of all the following materials would change the demand for which of the materials least?
Answer: gasoline
Form 1040 schedule F is a/an .
Form 1040 schedule F is a/an .
Answer: income tax form for farmers
A $25,000 loan is scheduled for repayment over a 10 year period, with equal annual principle payments of $2,500. The loan is said to be .
A $25,000 loan is scheduled for repayment over a 10 year period, with equal annual principle payments of $2,500. The loan is said to be .
Answer: amortized
Mr. Smith gathered 10,000 bushels of corn from his farm in October, 1985. He stored the corn and later sold it in May, 1986. With the accounting method he uses, he reported the value of the corn as income on his 1985 income tax return. His accounting method is the__________ .
Mr. Smith gathered 10,000 bushels of corn from his farm in October, 1985. He stored the corn and later sold it in May, 1986. With the accounting method he uses, he reported the value of the corn as income on his 1985 income tax return. His accounting method is the__________ .
Answer: accrual method
A tractor costing $32,000 is purchased. The assumed life is 7 years, and salvage value is established at $4,000. If $4,000 depreciation is taken each year, the method of depreciation is .
A tractor costing $32,000 is purchased. The assumed life is 7 years, and salvage value is established at $4,000. If $4,000 depreciation is taken each year, the method of depreciation is .
Answer: None of the answers listed
Current ratio is one of the most used of all financial management ratios. It measures the liquidity of your business
Current ratio is one of the most used of all financial management ratios. It measures the liquidity of your business
Answer: the short-run ability of your operation to service debt. The procedure for calculating the current ratio is . - total current assets divided by the total current liabilities
Production costs that do not vary with the level of total production and include items such as taxes and depreciation are called
Production costs that do not vary with the level of total production and include items such as taxes and depreciation are called
Answer: fixed costs
In considering farm financial statements, the balance sheet is also referred to as a/an
In considering farm financial statements, the balance sheet is also referred to as a/an
Answer: net worth statement
Under current IRS rules and regulations concerning depreciation, most farm equipment is
Under current IRS rules and regulations concerning depreciation, most farm equipment is
Answer: 5 year property
Which of the following is not one of the three basic forms of business organizations?
Which of the following is not one of the three basic forms of business organizations?
Answer: consortium
If a tractor's use is increased from 300 to 400 acres per year its
If a tractor's use is increased from 300 to 400 acres per year its
Answer: average fixed cost per acre will decline
A soybean producer is attending a class on soybeans in the futures market at the Vocational Agriculture department. He hears the term "basis" in the discussion. "Basis@ is
A soybean producer is attending a class on soybeans in the futures market at the Vocational Agriculture department. He hears the term "basis" in the discussion. "Basis@ is
Answer: the difference between the local cash price and the futures price
You are a soybean producer and want to remove some of the risk involved. You could
You are a soybean producer and want to remove some of the risk involved. You could
Answer: forward contract the beans
If you obtain a $5,000 balloon loan for five years and agree to pay interest only for the period, then you will owe at the end of five years
If you obtain a $5,000 balloon loan for five years and agree to pay interest only for the period, then you will owe at the end of five years
Answer: $5,000
There is a great deal of difference between which of these terms:
There is a great deal of difference between which of these terms:
Answer: hedging - speculating
A group of Vocational Agriculture students agreed to pool their money and purchase feed in bulk and distribute it at cost to each student as needed. This was a simple form of a .
A group of Vocational Agriculture students agreed to pool their money and purchase feed in bulk and distribute it at cost to each student as needed. This was a simple form of a .
Answer: cooperative
James thought that his sprayer would last five years. He should
James thought that his sprayer would last five years. He should
Answer: depreciate it over a period of five rears
A producer realized that he would have to borrow money for operating capital at some point during the year but didn't know exactly when. His Vocational Agriculture teacher suggested that he should prepare a to answer this particular question
A producer realized that he would have to borrow money for operating capital at some point during the year but didn't know exactly when. His Vocational Agriculture teacher suggested that he should prepare a to answer this particular question
Answer: cash flow statement
The grain embargo against Russia is an example of
The grain embargo against Russia is an example of
Answer: governmental interference with the free market.
The Commissioner of Agriculture proposes a new program to stabilize the price of corn by instituting a reserve system. This will probably work by
The Commissioner of Agriculture proposes a new program to stabilize the price of corn by instituting a reserve system. This will probably work by
Answer: releasing supplies in short production years and storing corn in years of heavy production
Cindy has the option of investing her money in non
Cindy has the option of investing her money in non
Answer: taxable bonds at 8% interest or in a money-market fund at 10%. She is in the 40% income tax bracket, what should she do? - invest in the bonds
If a producer has gross sales of $1,000,000, then it can be said that
If a producer has gross sales of $1,000,000, then it can be said that
Answer: None of the answers listed
If the Government were to set the price of milk at an artificially high price then a is likely to occur
If the Government were to set the price of milk at an artificially high price then a is likely to occur
Answer: surplus
Fixed cost plus cost equals total cost
Fixed cost plus cost equals total cost
Answer: variable
If pork and beef products compete and beef prices rise, then pork demand will probably
If pork and beef products compete and beef prices rise, then pork demand will probably
Answer: rise
Ann was reviewing her old tax returns and discovered that she had made a mistake on her 1984 return and had over
Ann was reviewing her old tax returns and discovered that she had made a mistake on her 1984 return and had over
Answer: paid her taxes that year. She should . . . - file an amended return.
Maynard worked for his father during the summer instead of a job offered to him at the feed store. The income he gave up at the feed store was a/an cost
Maynard worked for his father during the summer instead of a job offered to him at the feed store. The income he gave up at the feed store was a/an cost
Answer: opportunity cost
Just before John planted his peanuts, there was a severe drought and he has decided not to plant at all this season. John stands to lose
Just before John planted his peanuts, there was a severe drought and he has decided not to plant at all this season. John stands to lose
Answer: his fixed costs
Tom's assets amount to $40,000 and his liabilities are $3,000. What is his net worth?
Tom's assets amount to $40,000 and his liabilities are $3,000. What is his net worth?
Answer: $37,000
When trying to decide between two enterprises to add to the farm, a producer would use a budget
When trying to decide between two enterprises to add to the farm, a producer would use a budget
Answer: partial
If Pam's production cost for cabbage is $3.00 per bag and the price she receives is $5.00 per bag, how much would the price have to be for her to double the profit she makes at $5.00?
If Pam's production cost for cabbage is $3.00 per bag and the price she receives is $5.00 per bag, how much would the price have to be for her to double the profit she makes at $5.00?
Answer: $7.00
Joe put $2,000 into an IRA during 1985. When he paid his federal income tax for 1985 he paid tax on this IRE contribution.
Joe put $2,000 into an IRA during 1985. When he paid his federal income tax for 1985 he paid tax on this IRE contribution.
Answer: $0
Which of the items listed below is a. liability?
Which of the items listed below is a. liability?
Answer: $5,000 mortgage
If you apply for a second mortgage on your farm and the prime rate is the same as when you obtained the first mortgage, the interest rate for the second mortgage is likely to be than the interest rate of the first mortgage?
If you apply for a second mortgage on your farm and the prime rate is the same as when you obtained the first mortgage, the interest rate for the second mortgage is likely to be than the interest rate of the first mortgage?
Answer: higher
Which type life insurance is likely to have the lowest monthly premium?
Which type life insurance is likely to have the lowest monthly premium?
Answer: term
Vern and Lewis borrowed $10,000 together to buy a truck and start a hay hauling business. After three months, they were three months overdue with payments and the banker wanted his money. Lewis left town with the truck and gave no forwarding address. Vern decided to quit the business and realized he had lost his half of the truck. He went to the bank to pay his half of the money for the truck. The banker said:
Vern and Lewis borrowed $10,000 together to buy a truck and start a hay hauling business. After three months, they were three months overdue with payments and the banker wanted his money. Lewis left town with the truck and gave no forwarding address. Vern decided to quit the business and realized he had lost his half of the truck. He went to the bank to pay his half of the money for the truck. The banker said:
Answer: that will be $10,000
Why is automobile insurance more expensive for the 16-19 year old group than for the 26-29 year old group?
Why is automobile insurance more expensive for the 16-19 year old group than for the 26-29 year old group?
Answer: young people tend to have more accidents
Assume that the government passes a law forbidding banks to foreclose on financially stressed farms to recover their loans. A likely effect of this law would be to cause interest rates charged to all farmers to:
Assume that the government passes a law forbidding banks to foreclose on financially stressed farms to recover their loans. A likely effect of this law would be to cause interest rates charged to all farmers to:
Answer: increase
You put a $200 steer on feed at a cost of 35 cents per day. The animal gains one pound per day. If the price of cattle drops to 33 cents per pound and is expected to remain there, what should you do?
You put a $200 steer on feed at a cost of 35 cents per day. The animal gains one pound per day. If the price of cattle drops to 33 cents per pound and is expected to remain there, what should you do?
Answer: sell the animal immediately
Why do farmers generally have no control over prices?
Why do farmers generally have no control over prices?
Answer: there are many sellers competing in the market relative to the number of buyers
Cotton farmers in the early 1900's were devastated by the boll weevil. This is an example of the higher risk involved with ________.
Cotton farmers in the early 1900's were devastated by the boll weevil. This is an example of the higher risk involved with ________.
Answer: specialization
The "gross sales" of an operation is defined as:
The "gross sales" of an operation is defined as:
Answer: total sales before any expenses are subtracted.
"Which of the following is a method of risk management for agricultural producers?
"Which of the following is a method of risk management for agricultural producers?
A. marketing all crops on a cash basis
B. specialization
C. diversification
D. borrowing heavily"
Answer: diversification
Which is an advantage of land ownership over land leasing?
Which is an advantage of land ownership over land leasing?
Answer: Greater potential for equity accumulation.
One often hears that "farmers just can't find anyone to work on farms anymore." What does this indicate?
One often hears that "farmers just can't find anyone to work on farms anymore." What does this indicate?
Answer: farm wages are low compared with other alternatives
As an individual ages, the cost of a term life insurance policy would be likely to :
As an individual ages, the cost of a term life insurance policy would be likely to :
Answer: increase
Which of the following would a producer be most likely to use to determine the potential effects on profits of changing the mix of crops grown on the farm?
Which of the following would a producer be most likely to use to determine the potential effects on profits of changing the mix of crops grown on the farm?
Answer: partial budget
Lenders often require cash flow analyses to:
Lenders often require cash flow analyses to:
Answer: evaluate repayment potential.
Which of the following is an advantage of increasing financial leverage?
Which of the following is an advantage of increasing financial leverage?
Answer: It's a way to increase returns to equity capital
Charles found that he could reduce the fixed cost per bushel of wheat by increasing his acreage. His fixed cost per bushel was $32 on a 10 acre operation, $16 on a 20 acre operation, $8 on a 40 acre operation, $4 on an 80 acre operation, $2 on a 160 acre operation, etc. Charles was experiencing:
Charles found that he could reduce the fixed cost per bushel of wheat by increasing his acreage. His fixed cost per bushel was $32 on a 10 acre operation, $16 on a 20 acre operation, $8 on a 40 acre operation, $4 on an 80 acre operation, $2 on a 160 acre operation, etc. Charles was experiencing:
Answer: the principle of economy of scale
A plan for the use of money based on goals and expected income and expenditures is:
A plan for the use of money based on goals and expected income and expenditures is:
Answer: a budget
The total quantity of goods and services buyers are willing and able to buy at various prices at a given time is called:
The total quantity of goods and services buyers are willing and able to buy at various prices at a given time is called:
Answer: demand.
An economic system in which the means of production are privately owned and controlled and which is characterized by competition and the profit motive is called:
An economic system in which the means of production are privately owned and controlled and which is characterized by competition and the profit motive is called:
Answer: capitalism
One advantage in renting equipment is to:
One advantage in renting equipment is to:
Answer: release capital for other uses
An increase in the price of beef and pork will likely result in:
An increase in the price of beef and pork will likely result in:
Answer: increased consumption of poultry
The ________ function is best suited to return the rank as a percentage of students within a highschool.
The ________ function is best suited to return the rank as a percentage of students within a highschool.
Answer: PERCENTILE.INC
The ________ function can be used to perform a single condition summary.
The ________ function can be used to perform a single condition summary.
Answer: SUMIF
When using the RANK.AVG function the order argument determines the ________.
When using the RANK.AVG function the order argument determines the ________.
Answer: list sort
The ________ function is best suited to determine the number of high school students under the age of 16.
The ________ function is best suited to determine the number of high school students under the age of 16.
Answer: SUMIFS
The end_period argument should have the value of ________ if you are calculating cumulative interest using CUMIPMT for the third payment of a loan.
The end_period argument should have the value of ________ if you are calculating cumulative interest using CUMIPMT for the third payment of a loan.
Answer: 0
If payments are made at the end of the month the type argument should be set to ________ when using the IPMT function.
If payments are made at the end of the month the type argument should be set to ________ when using the IPMT function.
Answer: 0
If payments are made at the beginning of the month the type argument should be set to ________ when using the IPMT function
If payments are made at the beginning of the month the type argument should be set to ________ when using the IPMT function
Answer: 1
The ________ function determines the arithmetic mean, or average, of numeric entries in a database column.
The ________ function determines the arithmetic mean, or average, of numeric entries in a database column.
Answer: DAVERAGE
The first argument of any database function is ________.
The first argument of any database function is ________.
Answer: Database
A(n) ________ is a schedule that calculates the interest, principal repayment, and remaining balance of a loan.
A(n) ________ is a schedule that calculates the interest, principal repayment, and remaining balance of a loan.
Answer: Loan amortization table
The ________ function should be used to calculate the total number of periods in a loan.
The ________ function should be used to calculate the total number of periods in a loan.
Answer: NPER
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