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On my honor, as an Aggie, I have neither given nor received unauthorized aid on this academic work.Signature: ___________________________________ Seat #: __________________Printed Name: ________________________________Agricultural Economics 429Fall 2018 Exam #21. ________2. ________3. ________4. ________5. ________6. ________Total ________1a. (6 pts.)Answer the following question as it relates to corn payments in the 2002 farm bill assuming:the target price is $6.00/buthe marketing loan rate is $3.50/buthe direct payment rate is $0.75/bumarket price for corn of $3.00/buIf the market price increases by $1.00/bu to $4.00/bu, what would be the impact on counter-cyclical payments, direct payments, and marketing loan gains/loan deficiency payments? (i.e. CCPs go from xx to xx, etc)CCPs – DPs – MLG/LDPs - 1b. (4 pts.)In the 1990 Farm Bill, the carrot and stick approach were used. What were the carrot and stick that were used and why were they used? 2a. (6 pts.) Texas A&M is a good example of the land grant mission. Describe the mission/components of a land grant university and list the legislation that enables this mission. 2b. (6 pts.)???? The terms coupled or decoupled have specific meaning in ag policy. For the payments in the three farm bills below describe whether the payments were coupled or decoupled and if coupled what were they coupled to?1990 Farm Bill Marketing Loan gains 2002 Farm Bill direct payments2014 Farm Bill PLC payments?2c. (8 pts.)What were the primary reasons the 1996 farm bill was called a watershed change in agricultural policy? Why is it considered both a success and failure?3a. (6 pts.)The 2008 Farm Bill gave producers a choice of farm programs. Name the options. If a producer was extremely risk adverse which option would they choose and why? 3b. (4 pts.)The world population is expected to grow to over 9 billion by 2050 with most of the growth occurring in developing countries. Explain why the growth in those populations is important to U.S. ag producers?3c. (4 pts.)Evaluate the following statement and state whether you agree or disagree and supply support for you answer. NAFTA has been a failure for agriculture in the United States. 3d. (4 pts.)What did Dr. Sumner do wrong in his dealings with the Brazilian cotton case? Why did other commodity groups become concerned when cotton lost the case?4a. (4 pts.) The current (2014) farm bill has expired. Explain why Congress will be forced to act on a new farm bill or extend the current law. 4b. (6 pts.)Given the initial situation of no government programs and price P0 = $4 and quantity demanded and supplied at Q0=100. Assume the government wanted producers to receive $5 per unit of production and did not want to acquire stocks.Indicate how your suggested policy tool would work on the graph below and indicate how much government stocks would be acquired. $D100S$444$D100S$444Write the letter corresponding to the most appropriate answer in the blank provided: _______5a. (3 pts)Which of the following happened to cotton in the 2014 farm bill?Cotton was not eligible for the nonrecourse loanCotton’s base was moved to generic baseCotton could receive PLC paymentsAll of the aboveNone of the above_______5b. (3 pts)If a target price and an effective nonrecourse loan program are in effect for corn which of the following HAS to be true?There will be an effective price floor in placeThere will be CCC purchasesThere will be a deficiency payment paid to producersAll of the above None of the above ______ 5c. (3 pts.) The Price Loss Coverage program in the 2014 Farm Bill is very similar to:Direct paymentsACREMarketing loan/loan deficiency paymentsAll of the aboveNone of the above_______5d. (3 pts)Domestic support such as the SNAP program would fall into which of the WTO boxes?Green boxBlue boxAmber boxRed boxDe minimis box_______5e. (3 pts)Which of the following describes U.S. Ag Policy? Once a new program is adopted it tends to get changed right a way to accommodate market conditionsAg policy tends to be evolutionary rather than revolutionaryThe US agriculture is protected by relatively high tariffsAll of the aboveNone of the above_______5f. (3 pts)Which of the following policy tools discussed in class are counter-cyclical?Direct paymentsPLC PaymentsPFC paymentsAll of the aboveNone of the above_______5g. (3 pts)Which Farm Bill utilized the nonrecourse marketing loan rate?200220082014All of the aboveNone of the above_______5h. (3 pts)What makes a good safety net policy?A.All producers both domestic and international are better offB.At least domestic producers are better offC.Domestic consumers and producers are better offD.Good policy is in the eye of the beholderE.All of the above_______5i. (3 pts)Why have farmers have resisted government program changes?Farm program payments contribute to high economic returnsProgram changes affect land values through decouplingAdjustments in farm operations arising from program changes tend to be costlyAll of the above None of the above _______5j. (3 pts)Plant diseases that have potential for jeopardizing US ag production capacity:Are the responsible for world hungerAre a sanitary issueAre a phytosanitary issueAll of the above None of the above 6. (12 pts.)Given the initial situation of a target price and nonrecourse loan rate. Indicate where the market price, quantity supplied and demanded, government stocks and farmer payments would be on the graph below. Now on the second graph below show the difference in outcomes if the loan was a nonrecourse marketing loan and indicate where the market price, quantity supplied and demanded, government stocks and farmer payments would be on the graph below. Additionally, describe which policy foreign producers would prefer and why? 47053555880$NLRD0Q/yrS0TP00$NLRD0Q/yrS0TP4705352334260$NLRD0Q/yrS0TP00$NLRD0Q/yrS0TP ................
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