Ag Marketing Chapter 2
T or F: Competition plays a key role in fostering physical efficiency.
False
T or F: Food marketing system is perfect and conflict-free. And every participant in the system has the same goal.
False
T or F: In general, a structure of low concentration is assumed to allow firms in the industry to conduct themselves in such a way that result in poor performance.
False
T or F: New technology can increase price efficiency, but reduces physical efficiency.
False
T or F: Since it costs more to deliver milk to the home than to sell it in grocery stores, home delivery is an inefficient form of marketing.
False
T or F: When talking about the theory of industrial organization, the conduct of an industry decides its structure and performance.
False
True or False: Middlemen exist in the food marketing system will cause high food price and lower efficiency.
False
Which industry sector has had the greatest increase in labor productivity in the past three decades?
Farming
Which of the following is correct about the basket of goods that makes up a country's consumer price index (CPI)?
It updates the prices of the goods in the basket annually, but keeps the goods constant
_________ risk refers to those that occur because of changes in value of a product as it is marketed.
Marketing
___________ efficiency refers to physical changes that reduce input relative to output, or is concerned with maximizing output/input ratios.
Operational
__________ risk refers to those that occur from destruction or deterioration of the product itself by fire, accident, wind, earthquake, or other means.
Physical
__________________ efficiency is concerned with the success of the price system in efficiently allocating resources
Pricing
Which of these marketing functions is caused by food price variability?
Risk bearing
Which of these is true of food marketing functions? They cannot be performed by farmers They reduce the costs of marketing foods They add value to farm products They can be eliminated They should only be performed by middlemen
They add value to farm products
T or F: Agent middlemen receive income from fees and commissions.
True
T or F: Better labeling can increase price efficiency, but reduces physical efficiency.
True
T or F: Food processors & manufacturers specialize in adding time, place, and possession utility to raw farm products.
True
T or F: Functional approach can help improve the performance of the marketing machinery.
True
T or F: In general, the more and/or more complex functions performed, the greater the cost of marketing.
True
T or F: Sometimes, an increase in one type of efficiency often results in a decrease in the other.
True
T or F: Specialized middlemen exist because they can perform those functions more efficiently, and lower the marketing cost.
True
T or F: Speculative middlemen are those who buy and sell products with the purpose of profiting from price movement.
True
T or F: When evaluating of market performance, "Good" performance to one participant may be "bad" to another.
True
T or F: When talking about the theory of industrial organization, the performance of an industry refers to how well society's expectations are met.
True
True or False: Functional approach can help managers to understand the difference in marketing costs of various commodities.
True
In which of these markets does the farmer perform the most marketing functions?
U-Pick operations (or farm roadside markets)
Overall, the CPI tends to _____ the increases in the true cost of living.
accurately reflect
Institutions are ____________________ that are involved in the marketing process
agencies or businesses
As an agent middleman, _______________________________ does not have physical control of the product.
broker
Which of these middlemen do not take title and physical possession of food products?
brokers
As an agent middleman, _________________________ takes over the physical handling of the product.
commission man
The major groups of functions are:
exchange, physical, facilitating
Major categories of institutions in the marketing systems are:
merchant middleman, agent middlemen, speculative middlemen, food processor, facilitative organization
Efficiency is measured as the ratio of ______________
output/input
Economists classify risks in the marketing system into two categories, which are ____ risks:
physical and marketing
Merchant middleman includes :
wholesalers and retailers
The institutional approach breaks down the marketing system in terms of ________________.
"Who"
The functional approach breaks down system in terms of ______________________________.
"what" is done.
A marketing function is a market _____ .
Activity
Pricing efficiency is less than perfect when prices fails to: (a) fully represent consumer preferences. (b) direct resources from lower to higher-valued uses. (c) coordinate the buying and selling activities of farmers, marketing firms, and consumers
All three
The index used most often to measure inflation is the:
Consumer Price Index (CPI)
