tailieunhanh - Lecture Microeconomics (20/e): Chapter 20 - Campbell R. McConnell, Stanley L. Brue, Sean M. Flynn

Chapter 20 - Agriculture: Economics and policy. In this chapter, we start by looking at the economics of agriculture, investigating the elasticity of demand and price trends of agricultural goods. We will then examine reasons that the farming industry has been declining, using supply and demand analysis to explain this as well as the repercussions of the changes in the market. We will also discuss the types and outcomes of government intervention and recent changes in farm policy. | Agriculture: Economics and Policy Chapter 20 Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. In this chapter, we start by looking at the economics of agriculture, investigating the elasticity of demand and price trends of agricultural goods. We will then examine reasons that the farming industry has been declining, using supply and demand analysis to explain this as well as the repercussions of the changes in the market. We will also discuss the types and outcomes of government intervention and recent changes in farm policy. Economics of Agriculture Extreme diversity Farm products and food products Short-run price and income instability Inelastic demand Fluctuations in output Fluctuation in demand Dependence on world markets LO1 Agriculture is an extremely diverse industry, comprising everything from cattle ranches and pig farms to vegetable plots and grain farms. Firms can be | Agriculture: Economics and Policy Chapter 20 Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. In this chapter, we start by looking at the economics of agriculture, investigating the elasticity of demand and price trends of agricultural goods. We will then examine reasons that the farming industry has been declining, using supply and demand analysis to explain this as well as the repercussions of the changes in the market. We will also discuss the types and outcomes of government intervention and recent changes in farm policy. Economics of Agriculture Extreme diversity Farm products and food products Short-run price and income instability Inelastic demand Fluctuations in output Fluctuation in demand Dependence on world markets LO1 Agriculture is an extremely diverse industry, comprising everything from cattle ranches and pig farms to vegetable plots and grain farms. Firms can be small, family-based farms, or large, multi-national conglomerates. Some products benefit from government support, while others must fend for themselves. Agriculture also includes both farm commodities, which are raw materials, and food products that are sold through restaurants or grocery stores. While agriculture remains a profitable industry, it is a declining industry, especially in the realm of the smaller operations. There are some serious issues in the industry. It suffers frequently from short-run price and income instability, which may prevent firms from entering the market. One major cause of the instability is the . industry’s dependence on world markets. Many agricultural products come from other nations, which means the . industry is sensitive to changes in those markets. Economics of Agriculture LO LO1 1 Source: Derived from the authors from Foreign Agricultural Trade of the United States, ; and Bureau of Economic Analysis,