GFS Kosse

Question 1

In the law of demand higher price equals what

Answer 1

less quantity demanded

Question 2

In the law of demand lower price equals what

Answer 2

more quantity demanded

Question 3

Law of Demand is what?

Answer 3

The quantity purchased varies inversely with price

Question 4

Why does the demand slope down?

Answer 4

1. law of diminishing marginal utility
2. purchasing power
3. tastes/preferences

Question 5

Movement along the demand curve results from a change in price called a change in quantity demanded. T/F

Answer 5

True

Question 6

What happens when their is a increase in demand?

Answer 6

The demand curve shifts outward, up and to the right.

Question 7

What happens when there is a decrease in demand?

Answer 7

the demand curve shifts inward, down and to the left.

Question 8

What are some important demand shifters? what shifts the demand curve?

Answer 8

• income
• population
• price of substitutes
• price of complements
• expectations
• tastes and preferences

Question 9

The composition of food demand (or what we want to eat) is affected by what?

Answer 9

• expanded set of food choices from trade or other areas
• cultural norms
• individual tastes and preferences
• composition of population: household size, age, etc
• relative prices of different foods

Question 10

The most important long-term sources of growth in food demand worldwide are…

Answer 10

income growth per capita (measured by analyzing the change of GDP over time) and population growth.

Question 11

What is GDP?

Answer 11

Gross Domestic Product and is the market value of all final goods and services produced within a country in a year

Question 12

GDP per capita equals…

Answer 12

GDP/population

Question 13

GDP per capita means…

Answer 13

its the average GDP or the GDP per person

Question 14

Engels law of consumption states

Answer 14

as real income rises, per capita food consumption continues to increase, but at a slower rate than income growth

Question 15

what does the income elasticity of demand for food equal?

Answer 15

% change in money spent on food/1% change in real income

Question 16

normal goods =

Answer 16

most foods are normal goods and as income rises food expenditures for most goods increases. Positive income elasticity

Question 17

inferior goods =

Answer 17

as income rises per capita consumption declines. examples: potatoes and tubers. Negative income elasticity

Question 18

increases in living standards and rising per capita income leads to what?

Answer 18

1. increase in food consumed
2. change in dietary composition
3. diets become more varied

Question 19

Who developed classical theory of the relationships between food, resources, and population

Answer 19

Thomas Malthus

Question 20

What is demand?

Answer 20

Schedule of different quantities of a commodity that buyers are willing and able to purchase at different prices at a given time and place.

Question 21

Thomas Malthus believed what?

Answer 21

• population growth was exponential
• food production was linear
• he also didn’t take technological growth into account

Question 22

Thomas Malthus failed to account for what?

Answer 22

role of technology
improving social status
effective birth control
sustained economic development

Question 23

Neo means what

Answer 23

new

Question 24

What was stage one of the demographic transition?

Answer 24

High birth rates and high death rates

Question 25

What was stage two of the demographic transition?

Answer 25

rapid decline in death rates and slow decline in birth rates

Question 26

What was stage three of the demographic transition?

Answer 26

low and stable death rates

rapid decline in birth rates

Question 27

What was stage four of the demographic transition?

Answer 27

low birth and death rates

Question 28

demand trends for total food consumption is mainly driven by what?

Answer 28

population and income growth

Question 29

percent change in total food demand equals what

Answer 29

population growth rate PLUS (income growth rate TIMES income elasticity of demand)

Question 30

What is quantity supplied?

Answer 30

it is the amount of a good that sellers are willing and able to sell at a certain price

Question 31

In supply the price and quantity are positively or negatively related?

Answer 31

positively - supply curve is positively sloped

Question 32

what is individual supply?

Answer 32

the supply of a good in a particular business

Question 33

what is market supply?

Answer 33

the supply of a good in all businesses

Question 34

what does the law of supply state?

Answer 34

all other things being equal, the quantity supplied of a good rises when the price of a good rises, and falls when the price of the good fall

Question 35

As with demand curves, if only the price changes, we move ALONG the supply curve T/F

Answer 35

True

Question 36

A shift left and up reduces supply (less is supplied at any given price)

Answer 36

True

Question 37

A shift right and down does what to supply?

Answer 37

increases

Question 38

What are some important supply shifters?

Answer 38

- changes in the price of inputs
technological innovations
expectations
entry or exit of producers
changes in opportunity

Question 39

What are inputs?

Answer 39

inputs are resources like labor land capital and etc that are used to produce a good

Question 40

what is opportunity cost?

Answer 40

what you give up by choosing one activity instead of the next best activity

Question 41

A change in the price of an alternative good affects the supply.

Answer 41

True

Question 42

What are the two basic approaches to increase agricultural output?

Answer 42

• Extensification

- Intensification