Britainís Farmers Faring Well Despite Hoof-and-Mouth Disease

1. What is the impact on the global agricultural market of the US increase in demand for bio-fuels?

The US demand for biofuels reduces available domestic supply of agricultural products for consumption. The US must then turn to the global market for its goods. Demand on the global market rises.

2. Why is it that for a farmer to have a good year, it may be necessary for other farmers to have a bad year?

If all farmers have a good year, supply rises, and the price of the product falls. If others have a bad year, however, supply falls, and some farmers have a good year at the expense of other farmers.

3. The ban on meat produced in Britain could have what impact on meat prices in the US?

Prices for meat could rise, as demand for US-produced beef increases, both here and abroad.

Multiple Choice/True False Questions

1. Farmers in Britain are seeing a huge increase in demand for their cattle.
  1. True
  2. False
      ANS. b

2. Agricultural prices are rising for consumers because
  1. Supply increases are not keeping pace with demand increases.
  2. Supply increases are more than keeping pace with demand increases.
  3. Supply decreases are larger than demand decreases.
  4. Supply decreases are smaller than demand decreases.
      ANS. a

3. We have typically referred to agricultural markets as perfectly competitive because sellers are typically too small to have any impact on the price of their product, which is typically the same as that of other producers.
  1. True
  2. False
      ANS. a

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