Multiple
Choice
Identify the letter of the choice that best completes the statement or answers the
question.
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| 1. | A cooperative is owned by
its: a. | members | c. | lenders | b. | investors | d. | none of these are
correct | | | | |
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| 2. | A cooperative is usually
controlled on the basis of: a. | amounts of stock held by
investors | b. | 1 vote per member | c. | notes held by lender | d. | number of OSU football games
attended | | |
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| 3. | A cooperative distributes
benefits based on: a. | years of
membership | b. | amount of investment in the cooperative | c. | use of the cooperatives services | d. | how old the member is on January 1st. | | |
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| 4. | Cooperatives operate to
maximize: a. | profits to be retained by the cooperative | b. | return on investments in the cooperative | c. | profits for member/patrons | d. | retirement benefits of managers
only | | |
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| 5. | Farmers marketing, supply, and
service cooperatives in the United States total about: a. | 5,000 | b. | 2 million | c. | 50,000 | d. | 2 trillion | | | | | | | | |
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| 6. | Memberships in farmer
marketing, supply, and service cooperatives in the United States total about: a. | 1 million | b. | 2 million | c. | 4 million | d. | 8 million | e. | 16 million | | | | | | | | | | |
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| 7. | About what percent of major
farm inputs do farmers buy from their cooperatives:
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| 8. | About what percent of their
products do farmers market through their cooperatives
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| 9. | People organize cooperatives
to: a. | reduce costs | b. | obtain products or services otherwise not
available | c. | obtain market access | d. | increase income | e. | all of these are
correct | | |
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| 10. | A cooperative is defined as
a: a. | User-owned and democratically controlled business which benefits are received in
proportion to use | b. | Investor-owned and controlled business in
which the purpose is to maximize return on investments in the business | c. | Government financed business controlled by elected federal
officials | | |
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| 11. | Member-uses control their
cooperatives on the basis of: a. | years of
membership | b. | amount of members equity | c. | one-member, one-vote or voting according to use | d. | all of these are correct | | |
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| 12. | A cooperatives primary
benefits are derived from: a. | products and services
provided | b. | accrued members equity for retirement | c. | dividends on money invested in it | d. | number of season ticket holders for OSU football games | | |
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| 13. | Combined annual net sales
volume of farmer marketing, purchasing, and service cooperatives is: a. | less than $50 billion | c. | more than $100 billion | b. | about $70 billion | d. | about $700 billion | | | | |
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| 14. | Farmer cooperatives operate
to: a. | maximize profits for growth | b. | maximize profits for
farmer-members | c. | maximize value of farmer-members
stock | d. | no good choice is available | | |
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| 15. | It is necessary to own stock in
a cooperative to have the right to vote: a. | true | b. | false | c. | would depend on which political part you
support | | |
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| 16. | Cooperatives can operate at
lower costs per unit than farmers can individually by: a. | providing services for several or many farmers | b. | hiring inexperienced managers | c. | handling smaller volumes | d. | all of these are
correct | | |
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| 17. | A cooperative that increases
competition in a market could: a. | raise the going market prices for farm
products | b. | keep other firms from taking advantage of
farmers | c. | make the market more competitive | d. | all of these are correct | | |
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| 18. | Cooperatives limit returns on
equity capital because: a. | cooperatives do not require as much
capital as investor oriented businesses | b. | they are not concerned about making a
profit | c. | they want to discourage investment by
patrons | d. | all of these are correct | | |
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| 19. | Cooperatives increase farm
income by: a. | providing farmers higher prices for their products and lower prices
for farm supplies | b. | increasing per-unit
costs | c. | not distributing any net savings | d. | all of these are correct | e. | none of these are
correct | | |
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| 20. | Cooperatives are organized
to: a. | maximize net income | b. | minimize costs of
operation | c. | provide services as economically as possible | d. | all of these are correct | | |
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| 21. | Cooperatives benefit farmers
because: a. | individual farmers produce relatively small
volumes | b. | individual farmers produce so many different products that are well
known to consumers | c. | individual farmers produce large
volumes | d. | all of these are correct | | |
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| 22. | A supply cooperative that
operates at cost: a. | charges less than the going market
prices | b. | charges prevailing market prices | c. | charges prices for supplies that are about equal to its
costs | d. | all of these are correct | | |
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| 23. | An example of vertical
integration by purchasing cooperatives is: a. | regional cooperatives producing some of
their raw material requirements | b. | contracting with growers to produce seed
stocks under specifications | c. | oil exploration to help supply crude oil
for refineries and spread risks and opportunities for net margins | d. | all of these are correct | | |
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| 24. | Purchasing cooperatives benefit
farmers by: a. | Lowering the cost of production supplies | b. | Increasing the daily purchasing price levels in many trade
areas | c. | Enhancing the gross margin of competing
firms | d. | All of these are correct | | |
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| 25. | People join a
cooperative: a. | because of social objectives | b. | economic benefits--services and increased income | c. | for investment purposes | d. | to get better seats for OSU home football
games | e. | because of social objectives, economic benefits--services and
increased income and for investment purposes only | | |
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| 26. | Multi-State and national
cooperatives are created to: a. | provide an investment alternative for
member cooperatives | b. | expand horizontally the operations of
member cooperatives | c. | help existing cooperatives gain economic
efficiencies and increase market power nationally and internationally | d. | all of these are correct | | |
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| 27. | The cooperative principle of
operations at cost is usually accomplished by: a. | setting prices in order to cover expenses | b. | refunding to patrons any net margins remaining after deducting operating
expenses | c. | retaining net margins remaining after deducting operating expenses and
investing them in the cooperative | d. | all of these are
correct | | |
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| 28. | The primary reason for farmers
joining cooperatives is to: a. | improve their
well-being | c. | gain greater knowledge of agriculture | b. | drive other firms out of business | d. | help the
community | | | | |
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| 29. | If the average costs of
cooperatives decreases as they get larger they will likely: a. | reduce the size of their business | c. | keep their business the same
size | b. | expand the size of their business | d. | none of these are
correct | | | | |
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| 30. | Auction
cooperatives: a. | determine sales prices on commission basis | b. | determine sales price through open bidding | c. | is the only way OSU football ticket scalpers get tickets in
Columbus | d. | none of these are correct | | |
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| 31. | Orderly marketing
requires: a. | a degree of control over the product | b. | advance information on product volumes available | c. | authority to make firm sales commitments | d. | all of these are correct | | |
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| 32. | Marketing cooperatives are able
to expand markets for members products by: a. | developing net
products | b. | expanding geographically | c. | making products bigger | d. | developing net products and expanding
geographically | | |
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| 33. | All democratically controlled
marketing cooperatives allow one vote per member. a. | True | b. | False | c. | Correct choice not
listed | | | | | | |
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| 34. | Mixed
cooperatives are characterized by: a. | handling many different types of
products | b. | providing both farm supplies and marketing
services | c. | serving both member-farmer and member
cooperatives | d. | none of these are correct | | |
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| 35. | Farmers began organizing
marketing cooperatives in the U.S : a. | only
recently | c. | during wartime | b. | in the
1800s | d. | not sure about this question | | | | |
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| 36. | Bargaining cooperatives
generally: a. | take title and physical possession of member
products | b. | perform processing functions | c. | do not take title or physical possession of member products | | |
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| 37. | A cooperative engaged in
growing agricultural products: a. | may become a member of a marketing
cooperative | b. | is a cooperative | c. | may not become a member of a marketing cooperative | | |
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| 38. | Agricultural producers
generally lack bargaining power because: a. | individual farmers produce relatively
small volumes | b. | lack of product differentiation | c. | large size of food processor | d. | all of these are correct | | |
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| 39. | Diversified cooperatives
usually have: a. | cost sharing among products | b. | more uniformity of patrons | c. | more practical uniform pricing
practices | d. | all of these are correct | | |
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| 40. | Forward integration
is: a. | expansion into new trade territories | b. | carrying out activities which move products closer to the
consumer | c. | cooperatives involvement in agricultural
production | | |
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| 41. | Stages of Product Life Cycle
include: a. | adolescence | b. | maturity | c. | infancy | | | | | | |
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| 42. | Differential pricing
means: a. | pricing different products differently | b. | setting different prices in different trade areas | c. | using discounts and premiums | d. | adjusting a car transmission price | | |
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| 43. | The four Ps of marketing
are: Product, Place, Profit and Promotion. a. | true | b. | false | c. | still researching the answer, but good
question | | |
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| 44. | Federal and State laws are
regulations usually specifying: a. | the number of members a marketing
cooperative may have | b. | that member business must be greater than
nonmember business in a marketing cooperative | c. | the geographic boundaries of a cooperatives trade
area | | |
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| 45. | Barriers to a new product
development for some cooperatives include: a. | uncertain
returns | c. | high costs | b. | likelihood of copying by
competitors | d. | both uncertain returns and high costs | | | | |
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| 46. | The marketing technique used to
create a unique image for a product is called: a. | product
differential | c. | market segmentation | b. | market
differential | d. | product segmentation | | | | |
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| 47. | The marketing technique used to
create a unique image for a product is called: a. | product
differential | c. | market segmentation | b. | market
differential | d. | product segmentation | | | | |
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| 48. | Price maintenance is a policy
designed to: a. | generate relatively large margins | c. | generate relatively small
margins | b. | maintain below-market prices | | | | |
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| 49. | For price differentials to be
successful, cooperatives must: a. | price uniformly to all
patrons | b. | separate patrons into categories according to volume, location, method
of payment, or other criteria | c. | offer no discounts or
premiums | | |
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| 50. | Uniform pricing among members
is a cooperative principle and a legal requirement. a. | true | b. | false | c. | depends solely on which political party of members | | |
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| 51. | The objectives of structural
arrangements such as joint ventures, marketing agencies in common, and holding companies
include: a. | to increase market power | c. | to gain efficiency in
operations | b. | to gain market entry | d. | all of these are
correct | | | | |
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| 52. | A marketing agency-in-common
is: a. | a brokerage firm hired jointly by two or more cooperatives | b. | a jointly-owned cooperative warehousing operation | c. | like a federated cooperative that serves as a marketing agent of its
members | | |
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| 53. | A key element of pooling
is: a. | sales are handled on an individual account basis | b. | risk-sharing | c. | cash-at-delivery | d. | not sure of right answer, sorry | | |
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| 54. | A cooperative which integrates
vertically: a. | adds branch facilities to perform the same types of
services | b. | performs more functions or services to the same product as it moves
from farmer to consumer | c. | allows clients to jump start payments
every other month, vertically revising pay down on goods and services to save enough to buy one week
groceries | | |
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| 55. | Benefits of marketing
cooperatives include which of the following: a. | expanded markets | b. | loss of market power | c. | increased farm income
| d. | both expanded markets and increased farm
income | e. | all of these are correct | | |
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| 56. | Approval of the budget is the
responsibility of the: a. | manager | b. | treasurer | c. | directors | d. | auditor | | | | | | | | |
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| 57. | In a local cooperative, checks
to pay the bills are usually prepared by the: a. | manager | b. | treasurer | c. | board
president | d. | auditor | | | | | | | | |
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| 58. | Making sure the financial
records are accurate is the responsibility of the: a. | manager | b. | treasurer | c. | board president | d. | auditor | | | | | | | | |
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| 59. | An independent review of the
financial records is conducted by the: a. | manager | b. | treasurer | c. | board
president | d. | auditor | | | | | | | | |
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| 60. | Determining whether the
cooperative will extend credit to members and if yes, on net terms is the responsibility of
the: a. | manager | b. | treasurer | c. | directors | d. | auditor | | | | | | | | |
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| 61. | Approving individual
applications for credit is the responsibility of the: a. | manager | b. | treasurer | c. | directors | d. | auditor | | | | | | | | |
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| 62. | The auditor should be required
to send the audit report: a. | only to the
treasurer | c. | only to the directors | b. | only to the
manager | d. | to the manager and the director | | | | |
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| 63. | If the directors are to receive
compensation for serving, the level of pay should be set by the: a. | board president | b. | manager | c. | members | d. | treasurer | | | | | | | | |
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| 64. | Determining how the cooperative
will allocate a loss is the responsibility of the: a. | directors | b. | manager | c. | members | d. | treasurer | | | | | | | | |
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| 65. | Making sure notices of upcoming
meetings are sent to the members is the responsibility of the: a. | manager | b. | board president | c. | secretary | d. | attorney | | | | | | | | |
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