CCA Agricultural Economics and Business Management

Question 1

If total production costs are $480 per acre and expected yield is 160 bushels per acre, what is the break-even price per bushel?

Accepted Answer

$3.00

Answer

Break-even price = total cost per acre ÷ yield per acre = $480 ÷ 160 bu = $3.00 per bushel.

Question 2

Which of the following is classified as a variable cost in crop production?

Accepted Answer

Seed and fertilizer

Answer

Seed and fertilizer are variable costs because they change directly with planting decisions and acres farmed, unlike fixed costs such as rent, depreciation, and taxes.

Question 3

Gross margin for a crop enterprise is calculated as:

Accepted Answer

Total revenue minus variable (direct) costs only

Answer

Gross margin equals total revenue minus direct variable costs, measuring profitability before fixed overhead costs are subtracted.

Question 4

A cash rent lease arrangement means the tenant pays the landowner:

Accepted Answer

A fixed dollar-per-acre amount regardless of yield or price

Answer

Cash rent is a predetermined fixed dollar-per-acre annual payment to the landowner that does not vary with commodity prices or crop yields.

Question 5

Which marketing tool allows a grain producer to lock in a selling price for a crop before harvest?

Accepted Answer

Forward cash contract

Answer

A forward cash contract is an agreement between a producer and a grain buyer to sell a specific quantity at a predetermined price for a set delivery date, eliminating price risk.

(CCA) Certified Crop Advisor Practice Test

(CCA) Certified Crop Advisor Practice Test

CCA Agricultural Economics and Business Management