Agricultural Economics & Marketing Unit Test
Questions 1-100
1. What is Economics?
1 point
a. a social science concerned with the production, distribution, and consumption of goods and services.
b. studies how individuals, businesses, governments, and nations make choices about how to allocate
resources.
c. focuses on the actions of human beings, based on assumptions that humans act with rational
behavior, seeking the most optimal level of benefit or utility.
d. all of these
2. Economics is
1 point
a. a physical science
b. a social science
c. a biological science
d. a field of study but not a science
3. What is the origin of Economics?
1 point
a. “oikos” and “nomus”
b. ceteris paribus
c. ad libitum
d. none of the above
4. The study of growth in the Philippines’ standard of living is an example of:
1 point
a. Microeconomics
b. Macroeconomics
c. Political Economics
d. Consumer Behavior
5. The study of an individual consumption and expenditure patterns is an example of:
1 point
a. Microeconomics
b. Macroeconomics
c. Political Economics
d. Consumer Behavior
6. The division of Economics are as follows:
1 point
a. Applied and Theoretical Economics
b. Microeconomics and Macroeconomics
c. Positive and Normative Economics
d. all of the above
7. The basic and central economic problem confronting every society.
1 point
a. Money
b. Diseases and Illnesses
c. Scarcity
d. All of the above
8. Scarcity portrays the following:
1 point
a. reflects limited resources and unlimited wants and desires
b. leaves the society with the problem of choice
c. forces us to choose
d. all of the other three answers
9. The combination of land, labor and capital in order to produce outputs of goods and services
1 point
a. Distribution
b. Consumption
c. Wealth
d. Production
10. The direct utilization or usage of the available goods and services by the buyer or the consumer
sector.
1 point
a. Distribution
b. Consumption
c. Wealth
d. Production
11. What is an Economic system?
1 point
a. the combination of the various agents and entities that provide the economic structure that defines
the social community. Agents are joined by lines of trade and exchange goods.
b. may involve production, allocation of economic inputs, distribution of economic outputs, landlords
and land availability, households (earnings and expenditure consumption of goods and services in an
economy), financial institutions, firms, and the government.
c. the set of principles by which problems of economics are addressed, such as the economic problem of
scarcity through allocation of finite productive resources.
d. All of the above.
e. None of the above.
12. The following are the various economic systems by resource allocation, except
1 point
a. Traditional
b. Market
c. Feudalism
d. Mixed
13. The following are the various economic systems by ownership of the means of production, except
1 point
a. Capitalism
b. Socialism
c. Planned
d. None of the above.
14. Traditional economy is
1 point
a. based on goods, services, and work, all of which follow certain established trends, and it relies a lot on
people, and there is very little division of labor or specialization
b. based on the concept of free markets, there is very little government interference. The government
exercises little control over resources, and it does not interfere with important segments of the
economy.
c. common in communist societies since production decisions are the preserve of the government.
d. None of the above.
15. Market economy is
1 point
a. common in communist societies since production decisions are the preserve of the government.
b. based on goods, services, and work, all of which follow certain established trends, and it relies a lot on
people, and there is very little division of labor or specialization
c. when the government exercises little control over resources, and it does not interfere with important
segments of the economy. Instead, regulation comes from the people and the relationship between
supply and demand.
d. None of the above.
16. Planned economy is
1 point
a. when there is a dominant centralized authority – usually the government – that controls a significant
portion of the economic structure.
b. based on the concept of free markets, there is very little government interference.
c. there are usually very few resources to share in communities with traditional economic systems,
either few resources occur naturally in the region or access to them is restricted in some way.
d. None of the above.
17. Mixed economy is
1 point
a. its greatest downside is that it allows private entities to amass a lot of economic power, particularly
those who own resources of great value.
b. there is a dominant centralized authority – usually the government – that controls a significant
portion of the economic structure.
c. the norm globally, which combines the characteristics of the market and command economic systems.
d. None of the above.
18. An economic and social system in which capital and non-labor factors of production, or the means of
production, are privately controlled; labor, goods, and capital are traded in markets; profits are taken by
owners or invested in technologies and industries; and wages are paid to laborers.
1 point
a. Feudalism
b. Socialism
c. Communism
d. Capitalism
19. It is a philosophy based on the equitable distribution of wealth among a nation's citizens and
common ownership of all property.
1 point
a. Feudalism
b. Socialism
c. Capitalism
d. Communism
20. It relates more with socialism or the social-economic system where the people are divided into two
classes- the nobility, who owns the system, and the peasantry, who works for the nobility.
1 point
a. Feudalism
b. Socialism
c. Capitalism
d. Communism
21. The law of demand states that price and quantity demanded are
1 point
a. directly related, ceteris paribus.
b. inversely related, ceteris paribus.
c. independent.
d. positively related, ceteris paribus.
22. A demand schedule is a numerical tabulation of
1 point
a. prices and quantities supplied.
b. costs and quantities demanded.
c. prices and quantities demanded.
d. incomes and quantities demanded.
23. The law of supply states that price and quantity supplied are
1 point
a. inversely related, ceteris paribus.
b. directly related, ceteris paribus.
c. not related.
d. fixed.
24. At a price above the equilibrium price, there is
1 point
a. a shortage.
b. a surplus.
c. excess demand.
d. super-equilibrium.
e. none of the above
25. At a price below the equilibrium price, there is
1 point
a. a surplus.
b. a shortage.
c. excess supply.
d. sub-equilibrium.
e. none of the above
26. On a supply-and-demand diagram, equilibrium is found
1 point
a. where the supply curve intercepts the vertical axis.
b. where the demand curve intercepts the horizontal axis.
c. where the demand and supply curves intersect.
d. at every point on either curve
27. Opportunity cost is the value of
1 point
a. the best forfeited alternative.
b. the chosen alternative.
c. a free good.
d. all forfeited alternatives.
28. Ceteris paribus means
1 point
a. one variable too many.
b. the correct relationship specified.
c. assuming economic motives.
d. all other things held constant.
29. A normal good is
1 point
a. any good that consumers normally buy.
b. any good for which other goods can substitute.
c. a good for which the demand rises as income falls.
d. a good for which the demand rises as income rises.
30. An inferior good is
1 point
a. any good that consumers think is of low quality.
b. a good for which the quantity demanded increases as its price decreases.
c. a good for which the demand rises as income falls.
d. a good for which the demand rises as income rises.
31. Two indifference curves cannot intersect each other because:
1 point
a. They slope downwards.
b. They are convex to origin
c. They represent those combinations of two goods that give the same satisfaction.
d. Each indifference curve represents a different level of satisfaction and at the point of intersection it
would mean that the same combination yield two different levels of satisfaction.
32. The Law of Diminishing marginal utility states that
1 point
a. utilility initially increases and then after that diminishes at every point
b. total utility diminishes with the consumption of each additional unit
c. Utility always falls regardless of the amount of goods consumed
d. the marginal utility derived from consuming additional unit of a commodity diminishes
33. Factors of production are;
1 point
a. Inputs
b. Outputs
c. Only land and capital
d. Does not include labor
34. Which of the following is NOT true of a perfectly competitive industry?
1 point
a. There are a large number of sellers and buyers
b. Products and resources are freely mobile
c. There is perfect flow of market information in the industry
d. A large number of brand names of the product are available
35. The cost that a firm incurs in purchasing or hiring any factor of production is referred to as:
1 point
a. Explicit cost
b. Implicit cost
c. Variable cost
d. Fixed cost
36. A supplier in a purely competitive market is characterized by all except one of the following?
1 point
a. It produces such that marginal cost equals price
b. It produces a positive amount in the short run if it can recover variable costs
c. It can sell all it wants to at the prevailing market price
d. It can influence the price of its product prevailing in the market
37. Which of the following does not necessarily apply to a pure monopoly?
1 point
a. The product the firm produces must have no close substitutes
b. The firm must be the sole producer of the product
c. The firm must earn economic profits
d. There must be high barriers to entry facing potential competitors
38. The marginal cost of a productive resource is equal to the price of the resource if a firm is:
1 point
a. A price taker in the output market
b. A price taker in the resource market
c. Able to influence the price of the product by producing more or less of it
d. Able to influence the price of the factor by buying more or less of it
39. An indifference curve shows
1 point
a. Combinations of 2 goods that yield the same output
b. Combinations of 2 inputs that yields the same satisfaction
c. Combinations of 2 products that can be purchased given a fixed budget
d. Combinations of 2 goods that yield the same satisfaction to a consumer
40. In an indifference map, higher IC indicates
1 point
a. lower level of satisfaction
b. same level of satisfaction
c. higher level of satisfaction
d. either higher or same level of satisfaction
41. A science which deals with the proper combination and operation of production factors including
land, labor, and capital, and the choice of crop and livestock enterprise to bring about a maximum and
continuous return to the most elementary operating units in farming.
1 point
a. Farm management
b. Farm production
c. Land economics
d. Production economics
42. The following are problem areas in farming except
1 point
a. Lack of capital
b. Lack of technical information
c. Low productivity
d. Large-size farms
43. In the course of farming, an operator has to make major farm management decisions like
1 point
a. What to produce
b. What methods of production to use
c. How much input to apply
d. All of the above
44. The farm property record or farm inventory
1 point
a. Can best be taken when the amount of supplies on hand are at their highest point.
b. Can best be taken when the amount of growing crops is at the highest point.
c. Is a common method of determining the profitability of a farm business
d. Is a detailed list of all properties owned by the farm business with values assigned to them
45. A farm inventory is taken
1 point
a. To account for decreases in capital due to depreciation of farm buildings and machineries.
b. To ascertain the amount of money tied up in each class of asset.
c. To establish a basis in determining net worth at recurrent periods.
d. All of the above
46. A farm tractor purchased 20 years ago but never used
1 point
a. Would be worth less today because of obsolescence.
b. Would have the same value today.
c. Cannot be used in the farm anymore.
d. Would be worth more today than its purchase value 20 years ago
47. A type of farm budget which deals with the study of the flow of income and expenses to help
determine the need for credit
1 point
a. Cash flow budget
b. Partial budget
c. Complete farm budget
d. None of the above
48. A measure of the amount of money left to the owner of the farm business after liquidating the
business and paying all liabilities
1 point
a. Networth
b. Farm income
c. Liquidity
d. Solvency
49. A break-even price of P5.00 indicates that
1 point
a. it will cost P 5.00 to produce every unit of the product
b. the farmer does not make any profit if he sells his product at P5.00 per unit
c. the farmer must be able to sell at a price higher than P5.00 in order to realize some profit
d. all of the above
e. b & c only
50. A statement showing receipts, expenses, and net returns on a farm per year is called
1 point
a. Net worth statement
b. Cash flow statement
c. Enterprise budget
d. Income statement
51. Refers to the characteristics of a market organization that seem to exercise a strategic influence on
the nature of competition & pricing within the market.
1 point
a. Market structure
b. Market performance
c. Market conduct
d. Market efficiency
52. The practice of making a quality specification of grades uniform among buyers and sellers
1 point
a. standardization
b. advertising
c. packaging
d. grading
53. Which of the following is NOT considered a type of reseller?
1 point
a. Wholesaler
b. retailer
c. manufacturer
d. distributor
54. The cost of performing marketing services are called
1 point
a. margin
b. marketing cost
c. transport cost
d. profit
55. Marketing could be improved by providing support that will inform the buyers and sellers in the
market through the mass media. This function is
1 point
a. market information
b. price dissemination
c. price monitoring
d. price manipulation
56. Types of traders who sell directly to consumers located mostly in public markets
1 point
a. wholesaler
b. retailer
c. commission agent
d. barrio buyers
57. Consists of a group of sellers and buyers that facilitates the trading
1 point
a. retail market
b. supermarket
c. public market
d. market
58. Agricultural marketing consists of a series of services performed from the point of:
1 point
a. arrival
b. marketplace
c. consumption
d. production
59. Which of the following is an imperfect market?
1 point
a. Monopoly
b. Oligopoly
c. Both a and b
d. None of these
60. Which of the following is considered a “key player” in the marketing industry?
1 point
a. Marketer
b. suppliers or vendors
c. distributors or retailers
d. all of the above
61. When the net factor from abroad is deducted from GNP, the remainder is:
1 point
a. Gross Domestic Product
b. net national product
c. national income
d. disposable income
62. Interest bearing certificates of indebtedness
1 point
a. notes receivable
b. notes payable
c. bonds
d. borrowings
63. A family spends P2,000 on consumption goods when its income is zero and P6,000 when its income
is P6,000. Assuming a linear consumption function, what is the family’s autonomous consumption equal
to:
1 point
a. 6000
b. 2000
c. 3000
d. 1000
64. Which of the following is not a component of aggregate demand?
1 point
a. consumption
b. savings
c. investment
d. government spending
65. If the consumption is p60 billion when disposable income is p100 billion, the marginal propensity to
consume is
1 point
a. 0.6
b. cannot be determined from the information given
c. 0.4
d. 0.5
66. Savings is the accumulation of _____ through the postponement of ____.
1 point
a. income, consumption
b. wealth, consumption
c. investment, consumption
d. consumption, investment
67. Which of the following is not a component of GNP?
1 point
a. consumption expenditure
b. intermediate sales
c. investment
d. exports less imports
68. A demand for wage increase can cause:
1 point
a. demand-pull inflation
b. cost-push inflation
c. both demand -pull and cost-push inflation
d. nothing
69. Money in a modern economy performs such function(s) as:
1 point
a. all of the options
b. medium of exchange
c. store of value
d. standard of payment
70. The consumer price index (CPI) is designed to measure the degree to which:
1 point
a. income are distributed among the poor and rich over time
b. the cost of purchasing a bundle of consumer goods has changed with time
c. consumer patterns have changed with time because of prices
d. consumer prices have risen, relative to wages
71. A tariff is a
1 point
a. tax imposed on domestic producers of export goods
b. legal limit on the amount of a good that can be imported.
c. tax imposed on imported goods.
d. legal limit on the amount of a good that can be produced by foreign owners of a firm located in a host
country.
72. In the economy, the circular flow model denotes the role of the two important players, these are:
1 point
a. Demand and supply
b. Firms and households
c. Quantity and Price
d. Money and resource
73. A quota is a
1 point
a. tax on an imported good.
b. legal limit on the amount of a good that may be imported.
c. legal limit on the price of a good that may be imported.
d. subsidy to domestic producers of a good whose substitute is imported.
74. Tax on a person’s income, profits arising from properties, practice of profession specified in the Tax
Code of 1997 less with deductions and exemptions.
1 point
a. Estate tax
b. Income tax
c. Travel tax
d. Tariffs
75. The Agriculture and Fisheries Modernization Act of 1997 is otherwise known as:
1 point
a. Republic Act No. 3435
b. Republic Act No. 8435
c. Republic Act No. 3436
d. Republic Act No. 8436
76. The Tax Reform for Acceleration and Inclusion or TRAIN, the first package comprehensive tax reform
program, which was signed into law on December 19, 2017 as
1 point
a. Republic Act No. 109
b. Republic Act No. 10963
c. Republic Act No. 9634
d. Republic Act No. 10101
77. Republic Act No. 8550 of 1998 is also known as
1 point
a. The Meat Inspection Code of the Philippines
b. The Philippine Mining Code
c. The Philippine Fisheries Code
d. The Organic Code of the Philippines
78. This law promotes the reproduction, marketing and distribution of high-valued crops
1 point
a. Republic Act No. 7800
b. Republic Act No. 7900
c. Republic Act No. 8700
d. Republic Act No. 9700
79. The measurement use to describe how unequal is the country
1 point
a. Gini index
b. coefficient of variation
c. Ginie in a bottle
d. Kuznet’s curve
80. The gross domestic product (GDP) that is adjusted for inflation is called
1 point
a. Nominal GDP
b. Real GDP
c. inflated GDP
d. original GDP
81.Says that a country tends to produce for an export those products, which it can be produced most
cheaply and to import those products, which other countries can produce most cheaply.
1 point
a. comparative advantage
b. specialization
c. trade
d. barter
82. An act liberalizing the importation, exportation, and trading of rice, lifting for the purpose of
quantitative import restriction on rice and for other purposes or know as the “Rice Tariffication Law”
1 point
a. RA 01123
b. RA 11203
c. RA 32110
d. RA 30112
83. Once tariff is imposed the price of the imported commodities will
1 point
a. decrease
b. increase
c. remains the same
d. be uncertain
84. Shows the difference in final price of the finished goods before and after imposition
1 point
a. nominal protection
b. effective protection rate
c. implicit tariff
d. none of the above
85. The replacement of foreign production with domestic production
1 point
a. import substitution
b. transfer effect
c. protective effect
d. revenue effect
86. A tariff designed for protection must provide rates of duties high enough to achieve this objective
1 point
a. the encouragement of additional domestic production which could not take place because of
prevailing cost disadvantages
b. create a home market for the product
c. increase labor share to national income
d. increase employment
87. The most valid reason why a government imposes tariff for protection
1 point
a. protection for industries
b. creation of home market
c. raise government revenue
d. protection of infant industries
88. Consists of a group of countries that have abolished al tariff among them, but maintain their
individual tariffs vis-à-vis the outside world.
1 point
a. free trade area
b. customs union
c. common market
d. economic union
89. An example of free trade area
1 point
a. AFTA
b. EEC
c. WTO
d. EU
90. The summary of all economic transactions between the residents of one country vis-à-vis the rest of
the world
1 point
a. balance of payments
b. balance of trade
c. summary of trade
d. WB-IMF accounting
91. These are the multidisciplinary areas of agribusiness except…
1 point
a. Economics
b. Statistics
c. Management
d. Agricultural sciences
92. This is not a driver in Philippine agribusiness.
1 point
a. Changes in diets
b. Environmental consciousness
c. Population decline
d. Fixed or declining arable land
93. These are important factors in attaining farm productivity and product competitiveness.
1 point
Option 1
a. Machineries
b. Breeds
c. Seeds
d. Inputs
94. This is one of the features of agribusiness wherein crop prices change due to dependency of the
production cycle on the periods of the year for the development of the crop.
1 point
a. Biological nature
b. Seasonal nature
c. Uncertainty of weather
d. Variety of market conditions
95. This provides a competitive advantage to the raw and undifferentiated agricultural product.
1 point
a. Production
b. Processing
c. Marketing
d. Support
96. This refers to the ordering, tracking and storage of the stocks.
1 point
a. Supply chain
b. Ordering management
c. Stocking
d. Inventory management
97. This refers is about delivering product to earn revenue, procuring components or services at globally
competitive new ideas from design to delivery to enable sustained competitiveness.
1 point
a. Supply chain
b. Ordering management
c. Stocking
d. Inventory management
98. These are the benefits in having a packaging except…
1 point
a. Protection
b. Convenience
c. Sales-inefficiency
d. Enhancement/promotion
99. All productive activities are based on
1 point
a. Distribution
b. Exchange
c. Consumption
d. Marketing
100. Providing opportunities for small holders to be an active part in the supply chain and enabling them
to benefit from their participation
1 point
a. Contract growership
b. Community supported farms
c. Inclusive business models
d. Joint ventures
