AGEC 2003 Exam 1 Topics

Economics
Click the card to flip 👆
1 / 22
Terms in this set (22)
Economics
the study of how people and society end up choosing, with or without the use of money, to employ scarce productive resources that could have alternative uses to produce various commodities and distribute them for consumption, now or in the future, among various persons or groups within society. Economics analyzes the costs and benefits of improving patterns of resource use"
Agricultural Economics
applied social science dealing with how humans choose to use technical knowledge and scarce productive resources such as land, labor, capital, and management to produce food and fiber and to distribute it for consumption to various members of society over time
Economics and agricultural economics are related or unrelated?
Related
Agricultural economics is a field of economics applied to what economy?
agricultural economy
Similarities
Human decision-making (agricultural economics is a social science). ◦ Choice. ◦ Use of scarce productive resources. ◦ Production of commodities. ◦ Distribution of commodities among members of society over time
Differences
Agricultural economics: ◦ Is applied. ◦ Deals with the production and consumption of food and fiber.
Microeconomics
is the level of economics that deals with single decision-making entities, such as firms, people, or markets.
examples of microeconomics
How profitable is a large agricultural business firm? ◦ How will Sue use her limited resources to purchase inputs for her farm? ◦ Which food item will Jack choose, given his preferences and alternatives?
Macroeconomics
is the level of economics that deals with the economic system as a whole - economic activities in the aggregate
examples of macroeconomics
How "well" is the economy doing? ◦ What is the level of unemployment? ◦ How do U.S. incomes compare with those in other countries?
Agribusinessincludes the sum total of all operations involved in the manufacture and distribution of farm supplies; production operations on the farm; and the storage, processing, and distribution of farm commodities and items made for themT/F Agribusiness includes some business operations pertaining to agriculture?False. ◦ Agribusiness includes all business operations pertaining to agriculture.T/F. There is little difference between the traditional agricultural economics degrees and agribusiness degrees at most Land Grant universities.TrueSo who can be considered part of the Agribusiness Sector?◦ Cattle Farmer ◦ Sugar Cane Farmer ◦ Crawfish Farmer ◦ Cargill ◦ ADM ◦ McDonalds ◦ International Paper ◦ JB HuntPositive Economics vs Normative EconomicsPositive Economics: is the branch of economics that describes the relationship between cause and effect Normative Economics: is a part of economics examining questions of what ought to bePositive and Normative ExamplesPositive Example: Government has imposed 10% sales tax Normative Normative Example: Government should impose 2% sales taxScarcityNature and mankind do not provide for unlimited amounts of any resource, good, or service. People generally do not have enough money to satisfy all of their wants or needs. Thus, people must economize in making decisions.Without ______, there would be no need for the study of economicsscarcityopportunity costthe cost associated with opportunities that are foregone when a firm's resources are not put to their highest-value useopportunity cost exampleConsider a firm that owns a building and therefore pays no rent for the office space. Opportunity cost is the forgone rent of utilizing the office space.ManagementThe process used to control or direct a situation.five basic steps of managerial decisionsObserving a problem & thinking about its solution. ◦ Analyzing with further observations. ◦ Making the decision. ◦ Taking action. ◦ Accepting responsibility