Multiple Choice
Identify the
choice that best completes the statement or answers the question.
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1.
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People organize cooperatives
to:
a. | reduce
costs | b. | obtain products or services otherwise not
available | c. | obtain market access | d. | increase income | e. | all are
correct |
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2.
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Member- users 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 are correct |
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3.
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Which of the following is the
federal agency authorized by the Cooperative Marketing Act of 1926 to help develop sound and
efficient cooperatives?
a. | Agricultural Cooperative Service
(ACS) | b. | Agricultural Stabilization and Conservation Service
(ASCS) | c. | Cooperative State Research service (CSRS) | d. | Extension Service
(ES) |
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4.
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What general farm organization
is recognized as a pioneer in spreading cooperative principles into agricultural areas of the
Nation?
a. | American Farm Bureau
Federation | b. | National Council of Farmer Cooperatives | c. | National Farmers
Organization | d. | National Grange |
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5.
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Which of the following is not a
function of USDA’s Agricultural Cooperative Service (ASC)?
a. | research | d. | education and information | b. | technical assistance | e. | short term loans | c. | history and statistics |
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6.
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The “Magna Carta”
of farmer cooperatives was passage of legislation known as:
a. | Agricultural Marketing Act of
1926 | c. | Rural Electrification
Act | b. | Capper-Volstead Act | d. | Smith-Lever Act |
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7.
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The process for nominating and
electing directors of a cooperative is usually defined by the _______.
a. | manager | c. | board of directors | b. | members | d. | articles of incorporation/ by
laws |
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8.
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Which of the following is a
major responsibility of a cooperative’s board of directors?
a. | adopt and amend
bylaws | c. | control daily
operations | b. | employ a general manager | d. | elect competent board members |
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9.
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Planning, organizing,
directing, coordinating, and controlling are functions generally assigned to
cooperative:
a. | directors | b. | members | c. | employees | d. | managers |
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10.
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The first known formal
cooperative in the United States claimed as one of its founders:
a. | Pocahontas | c. | Robert Owen | e. | Woody Hayes | b. | Benjamin Franklin | d. | George Washington |
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11.
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In terms of memberships, U.S.
cooperatives are largest in:
a. | agricultural
marketing | c. | credit
unions | b. | agricultural supply purchasing | d. | worker |
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12.
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A regional farm supply
cooperative may be organized as all the following EXCEPT:
a. | a centralized
cooperative | b. | a federated cooperative | c. | a mixed cooperative containing both centralized and
federated components | d. | a nonmember, investor- owned
cooperative |
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13.
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In an agricultural cooperative,
the benefits normally go to:
a. | patrons in proportion to
use | b. | only to member- investors in proportion to their
investment | c. | all stockholders according to their
investment | d. | the manager and employees according to their
hours |
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14.
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The capper- Volstead Act was
passed by congress in:
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15.
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The basic cooperative
principles were developed by:
a. | James
Wallingford | b. | the Romans | c. | trades people in Rochdale, England | d. | a group of pioneer farmers in Meyersville, New
Hampshire |
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16.
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All of the following Are
considered National cooperative organizations EXCEPT:
a. | National Milk Producers
Federation | b. | National Rural Electric Cooperative
Association | c. | National Cattleman’s Association | d. | Volunteers in Overseas Cooperative
Assistance |
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17.
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A rural electric cooperative
would be classified as a:
a. | marketing
cooperative | c. | service
cooperative | b. | supply cooperative | d. | purchasing cooperative |
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18.
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The purpose of the first formal
cooperative in the United States was to provide:
a. | a market for
cheese | b. | for the marketing of hogs | c. | fire insurance | d. | a way to purchase fertilizer more
economically |
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19.
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Farmers become members of
cooperatives for the following reasons EXCEPT:
a. | dividends and chance for
appreciation of the stock | b. | increased farm income | c. | to secure a source of a particular
supply | d. | to gain market power |
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20.
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Cooperatives endeavor
to:
a. | maximize net
income | b. | minimize costs of acquisition and operation | c. | provide their services as economically as
possible | d. | all are correct |
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21.
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By working together in a
cooperative, members can:
a. | increase their marketing and
purchasing costs | b. | take advantage of economies of size | c. | reduce their bargaining
power | d. | limit market access |
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22.
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A pooling
cooperative:
a. | assembles and commingles products
from many producers | b. | combines sales returns and operating
expenses | c. | prorates or distributes net returns among members in proportion to the volume
each provides through the cooperative over a specified time | d. | all are
correct |
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23.
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A cooperative that prices at
prevailing levels:
a. | increases the likelihood of extreme
pricing practices by competitors | b. | increases the chances for the cooperatives to realize net margins and
accumulate operating reserves to cushion the effects of market price declines or unusual
expenses | c. | transfers some decision making to the
cooperative | d. | all are correct |
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24.
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Most cooperatives do not price
at the “cost of doing business” because:
a. | it is impossible to calculate and
leaves no leeway for unforeseen expenses | b. | net margins would become too high | c. | it would give competitors an
advantage | d. | all answers |
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25.
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Farmers belong to purchasing
cooperatives to:
a. | reduce costs of production supplies
and equipment | b. | ensure they have a dependable source of
supplies | c. | obtain supplies of a quality that will help them maximize their
returns | d. | all answers are correct |
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26.
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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 margins of competing
firms | d. | all answers are correct |
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27.
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People join a
cooperative:
a. | because of social
objectives | b. | economic benefits --- services and increased
income | c. | for investment purposes | d. | all answers are
correct |
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28.
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The primary reason for farmers
joining cooperatives is to:
a. | improve their
well-being | b. | drive other firms out of business | c. | gain greater knowledge of
agriculture | d. | help the community |
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29.
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If the average costs of
cooperatives decrease 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. | no answers are correct |
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30.
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Cooperative management is
concerned primarily with:
a. | maximizing the profit of the
cooperative | b. | meeting the needs of farmer-members | c. | fulfilling members’ needs while maintaining a strong
business | d. | meeting government regulations |
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31.
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Bargaining cooperatives
negotiate for:
a. | product grade and quality
differentials | b. | product prices | c. | delivery schedules | d. | all answers are
correct |
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32.
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Advantages of commodity pools
include:
a. | spreads market
risks | c. | helps finance the
cooperatives | b. | permits orderly marketing | d. | all answers are correct |
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33.
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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 answers are
correct |
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34.
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Marketing cooperatives are able
to expand markets for members products by:
a. | developing new
products | b. | expanding geographically | c. | making products bigger | d. | developing new products and expanding
geographically | e. | all answers are correct |
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35.
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The marketing technique used to
create a unique image for a product is called:
a. | product
differentiation | c. | market
segmentation | b. | market differentiation | d. | product segmentation |
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36.
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A product is most profitable
during what period of its life cycle?
a. | introductory
period | c. | market maturity
period | b. | market growth period | d. | sales decline period |
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37.
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Marketing is best defined
as:
a. | selling a
product | b. | distribution of the product to the final
consumer | c. | advertising, promotion, and sale of products and
services | d. | all of the activities required to bring customer and product together in a
sale |
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38.
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Most of cooperative equity
comes from:
a. | retained patronage
refunds | c. | direct cash
investment | b. | per- unit capital retains | d. | unallocated reserves |
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39.
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The most common type of
systematic equity redemption plan is:
a. | per- unit
retains | c. | the revolving fund
plan | b. | the base capital plan | d. | percent-of-all-equity plan |
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40.
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The current assets of a
cooperative minus its current liabilities gives you:
a. | working
capital | c. | cost of goods
sold | b. | net income | d. | undistributed proceeds |
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41.
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With the percent- of-equity
redemption plan:
a. | a cash dividend is paid instead of
redeeming equity | b. | the same percent of equity capital is redeemed from all equity
holders | c. | the earliest year outstanding is redeemed | d. | only equity of inactive members is
redeemed |
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42.
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A distinctive difference
between cooperatives and other business types is:
a. | how earnings are distributed
| c. | the number of
owners | b. | the size of the business | d. | the types of products sold |
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43.
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The retained portion of a
patronage refund is:
a. | paid to members in cash the next
year | b. | allocated to members’ equity accounts and paid out
later | c. | retained in unallocated earnings of the
cooperative | d. | equal to the amount of cash patronage
refunds |
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44.
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Patronage refunds demonstrate
which cooperative feature?
a. | democratic
control | c. | cooperation among
farmers | b. | benefits in proportion to use | d. | political neutrality |
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45.
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Cooperative equity usually
has:
a. | a definite dividend
rate | c. | an interest
rate | b. | a maturity date | d. | no answers are correct |
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46.
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Having an established plan for
redeeming member equity earned in earlier years:
a. | helps to keep the
cooperative’s ownership in the hands of current users | b. | reduces patron’s
income | c. | decreases the amount of current member ownership in the
cooperative | d. | reduces current patron’s investment and increases past patrons’
investment |
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47.
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The balance sheet item
“investment in other cooperatives” of a local farm supply cooperative usually
represents:
a. | cash investments the cooperative has
made in support of the cooperatives in its service area | b. | investments other cooperatives have made in the local
supply cooperative | c. | the cooperative’s ownership of federated
cooperatives | d. | federated cooperatives ownership in the local
cooperative |
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48.
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The primary management function
of the directors of a cooperative is:
a. | determining objectives and general
policies | b. | approving amendments to the articles of incorporation and by-
laws | c. | deciding the color scheme for company
vehicles | d. | making day-to-day operating
decisions |
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49.
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The primary management function
of the manager is:
a. | determining objectives and general
policies | b. | approving amendments to the articles of incorporation and
by-laws | c. | making day-to-day operating decisions | d. | appointing policy
committee |
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50.
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The officers of a cooperative
are usually selected by:
a. | members | c. | directors | b. | board president | d. | extension agent |
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51.
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Developing long-range plans for
the cooperative is a responsibility of the:
a. | directors | c. | manager | b. | board president | d. | members |
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52.
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Deciding how to handle daily
business activities is a responsibility of the:
a. | directors | c. | manager | b. | board president | d. | members |
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53.
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Keeping cooperative meetings
running smoothly is the responsibility of the:
a. | directors | c. | member | b. | board president | d. | manager |
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54.
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Selecting the attorney is the
responsibility of the:
a. | manager | b. | auditor | c. | directors | d. | members |
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55.
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Selecting the auditor is the
responsibility of the:
a. | treasurer | c. | board president | b. | directors | d. | manager |
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56.
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Approving a loan is the
responsibility of the:
a. | directors | b. | treasurer | c. | manager | d. | auditor |
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57.
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The Clayton does
not:
a. | legalize the organization of
agricultural associations | b. | explicitly exempt agricultural cooperatives from all antitrust
laws | c. | prohibit monopolization and restraint of
trade | d. | prohibit certain kinds of price
discrimination |
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58.
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The Sherman
Act:
a. | was passed to legalize the
organization of agricultural cooperatives | b. | prohibits restraint of trade and
monopolization | c. | prohibits price discrimination | d. | declares unlawful, unfair methods of competition, or
unfair or deceptive acts or practices |
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59.
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The Robinson-Patman
Act:
a. | was passed to legalize the
organization of agricultural cooperatives | b. | prohibits restraint of trade and
monopolization | c. | prohibits price discrimination | d. | declares unlawful, unfair methods of competition, of
unfair of deceptive acts or practices |
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60.
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The Capper-Volstead Act applies
to:
a. | farmer supply
cooperatives | b. | all marketing cooperatives | c. | farmer marketing
cooperatives | d. | cooperatives with limited marketing
power |
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61.
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Which of the following is most
beyond a cooperative’s ability to control?
a. | emerging biotechnology and
information technology | b. | limitations of being a cooperative | c. | the choice of organizational
structure | d. | markets in which cooperatives have a role to
play |
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62.
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U.S. Office of Technology
Assessment suggests which agricultural segment will be the least likely to
survive?
a. | small
farms | c. | large
farms | b. | moderate-size family farms | d. | cooperatives |
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63.
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Under the Capper-Volstead Act,
farmer members may not act together in:
a. | collectively
processing | c. | handling nonmember
products | b. | restraining trade | d. | bargaining for an enhanced price |
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64.
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The Capper-Volstead Act
prohibits:
a. | farmers from becoming members of
more than one cooperative | b. | cooperatives from unduly enhancing the price of any agricultural
product | c. | cooperatives from sharing specific
facilities | d. | cooperatives from coordinating their marketing
arrangements |
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65.
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The Capper-Volstead Act
prohibits:
a. | prohibits collaborating with
non-cooperatives | b. | allows collaborating with non-cooperatives | c. | says nothing about collaborating with non
cooperatives | d. | prohibits cooperatives from enhancing the price of any agricultural
product |
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