Quiz 4

If the price of a farm commodity such as lettuce falls abruptly, you can be confident that lettuce production costs have fallen.

False

Low prices usually "cure" low prices within a single production period.

False

Whereas seasonality refers to price patterns within a year, price cycles refer to patterns that may occur over longer periods

True

Wheat marketing margins may rise in the same season as farm wheat prices fall because of which of the following?

A big wheat crop can depress wheat prices while raising the demand for wheat marketing services.

Which of the below is true about current cash prices of agricultural commodities?

All of the above. (Their normal levels are most affected by the positions of their long-run supply curves.) (The large variations from year to year in hog prices are usually caused by large swings in quantities of hogs marketed.) (Large shifts in demand are more likely for important export commodities than for others.)

Which of the following is true about the farm-to-retail marketing spread?

It is relatively less for fresh milk than for a more highly processed item such as bread.

Lowering the farm-to-retail margin on milk results in which of the following?

It will increase the farm price of milk if retail demand stays unchanged.

In considering agricultural prices.

Storable crops that are relatively more expensive to store, such as apples, will typically exhibit greater seasonal price variation than those with lower storage costs, such as wheat.

Cattle cycles are each about ten years in length.

True

The supply curve of watermelons ready for harvest may look like this.

True