EQ #2 AGEC Capps (4 pts) September 12, 2011

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Presentation transcript:

EQ #2 AGEC 105 - Capps (4 pts) September 12, 2011 Suppose that Trent Lewis, a rice farmer near Beaumont, Texas, garners $650,000 in gross farm income and incurs production expenses of $300,000. In addition, suppose that the CPI was 2.00. Further, suppose that Trent Lewis has assets totaling $17 million and liabilities totaling $9 million. What is the real net farm income of Trent Lewis? The equity for this rice farmer is $___________ million. Another term for equity is _______________. The portion of food expenditures associated with the activities of firms beyond the farm gate is known as the _______________. (1 pt) (1/2 pt)

Bottles of Coca-Cola (CC) Consider the following chart. Assuming total utility is defined as U =2*W*CC, (1/2 pt) (a) Which bundle has the highest level of total utility? (1/2 pt) (b) Which bundle has the lowest level of total utility? Bundle Number of Wings (W) Bottles of Coca-Cola (CC) A 3 B 6 4 C 9 2 D 12 1