AGEC 325 Exam 1 Study Guide 2026 | Complete Review, Practice Questions &
Exam Prep
**Describe the structure of farms and ranches today:
-
- - ANS ✔✔-number of farms in the US decreasing
-average farm size is increasing
(fewer but larger farms)
**What are the 4 main causes of structure changes in farms and ranches today? - ANS ✔✔-
Labor-saving technology
-Greater off-farm employment opportunities
-Desire of farm operators for higher income
-High fixed costs of some technology -specialization
What are the 4 General Business Strategies? - ANS ✔✔-Low Volume, High Value Producers
-High Volume, Low Margin Producers
-Specialty Product and Service Providers
-Part-Time Operators
**Describe 4 characteristics of New Technology. - ANS ✔✔-Agricultural technology has been
evolving for many decades
-Biotechnology offers possible gains in efficiency for crop production
-Livestock performance may improve through introducing new genetic characteristics or
improving nutrient use
-Global positioning systems (GPS) increasingly adopted
,**Describe 5 characteristics of the Information Age. - ANS ✔✔-Improvements in data collection
-Very specific data
-Automatic recording
-Personal computers
-A new problem of "too much" information?
**Describe 6 characteristics of Controlling Assets. - ANS ✔✔-Need for outside capital
-Vertical integration in traditional sources of farm credit
-Urban and rural financial markets will move closer together
-Increased need for documentation
-Need for standard accounting practices
-Increase in renting/leasing assets
**Describe 3 characteristics of Human Resources. - ANS ✔✔-Increased dependence on teams
of employees or partners with division of labor
-Farm businesses will need to be competitive with off-farm employment
-Increased use of consultants and paid advisors
**Describe 5 characteristics of Producing to Meet Consumer Demands. - ANS ✔✔-More
specialized and processed food
-Buyers are implementing stricter product standards
-Producers who can provide high-quality, uniform standard product will receive premium price
-More agricultural products will go to industrial uses
-Niche markets will also gain in importance
, **3 characteristics of Contracting and Vertical Integration. - ANS ✔✔-Some producers will
specialize in a phase of production..........Examples: raising dairy replacement heifers, custom
harvesting crops, producing bedding plants
-Marketing contracts provide assured market for intermediate products
-VERTICAL INTEGRATION- occurs if buyer supplies some of inputs and management
What is vertical integration? - ANS ✔✔occurs if buyer supplies some of inputs and management
**4 characteristics of Environmental and Health Concerns - ANS ✔✔-Concerns about food
safety and environmental preservation are high priority
-Increased rural population means more contact between farm and non-farm residents,
increased concern about animal waste, air and water quality
-Environmental audits becoming routine in farm sales
-Each decision must be evaluated for its effect on the environment as well as profit
**3 characteristics of Globalization - ANS ✔✔-Expansion of markets can occur through
international trade
-Many governments, including U.S. government, have tried to protect their own farmers from
foreign competition using trade barriers
-World Trade Organization (WTO) is dedicated to negotiating free trade
Exam Prep
**Describe the structure of farms and ranches today:
-
- - ANS ✔✔-number of farms in the US decreasing
-average farm size is increasing
(fewer but larger farms)
**What are the 4 main causes of structure changes in farms and ranches today? - ANS ✔✔-
Labor-saving technology
-Greater off-farm employment opportunities
-Desire of farm operators for higher income
-High fixed costs of some technology -specialization
What are the 4 General Business Strategies? - ANS ✔✔-Low Volume, High Value Producers
-High Volume, Low Margin Producers
-Specialty Product and Service Providers
-Part-Time Operators
**Describe 4 characteristics of New Technology. - ANS ✔✔-Agricultural technology has been
evolving for many decades
-Biotechnology offers possible gains in efficiency for crop production
-Livestock performance may improve through introducing new genetic characteristics or
improving nutrient use
-Global positioning systems (GPS) increasingly adopted
,**Describe 5 characteristics of the Information Age. - ANS ✔✔-Improvements in data collection
-Very specific data
-Automatic recording
-Personal computers
-A new problem of "too much" information?
**Describe 6 characteristics of Controlling Assets. - ANS ✔✔-Need for outside capital
-Vertical integration in traditional sources of farm credit
-Urban and rural financial markets will move closer together
-Increased need for documentation
-Need for standard accounting practices
-Increase in renting/leasing assets
**Describe 3 characteristics of Human Resources. - ANS ✔✔-Increased dependence on teams
of employees or partners with division of labor
-Farm businesses will need to be competitive with off-farm employment
-Increased use of consultants and paid advisors
**Describe 5 characteristics of Producing to Meet Consumer Demands. - ANS ✔✔-More
specialized and processed food
-Buyers are implementing stricter product standards
-Producers who can provide high-quality, uniform standard product will receive premium price
-More agricultural products will go to industrial uses
-Niche markets will also gain in importance
, **3 characteristics of Contracting and Vertical Integration. - ANS ✔✔-Some producers will
specialize in a phase of production..........Examples: raising dairy replacement heifers, custom
harvesting crops, producing bedding plants
-Marketing contracts provide assured market for intermediate products
-VERTICAL INTEGRATION- occurs if buyer supplies some of inputs and management
What is vertical integration? - ANS ✔✔occurs if buyer supplies some of inputs and management
**4 characteristics of Environmental and Health Concerns - ANS ✔✔-Concerns about food
safety and environmental preservation are high priority
-Increased rural population means more contact between farm and non-farm residents,
increased concern about animal waste, air and water quality
-Environmental audits becoming routine in farm sales
-Each decision must be evaluated for its effect on the environment as well as profit
**3 characteristics of Globalization - ANS ✔✔-Expansion of markets can occur through
international trade
-Many governments, including U.S. government, have tried to protect their own farmers from
foreign competition using trade barriers
-World Trade Organization (WTO) is dedicated to negotiating free trade
