AgEc Exit Exam Guide Book-Revised 2023

AGRICULTURAL ECONOMICS NATIONAL EXIT EXAM GUIDEBOOK
DEBRE BERHAN UNIVERSITY
COLLEGE OF AGRICULTURE AND NATURAL

RESOURCE SCIENCES
DEPARTMENT OF AGRICULTURAL ECONOMICS
REVISED NATIONAL EXIT EXAM GUIDEBOOK
FEBRUARY, 2022
DEBRE BERHAN, ETHIOPIA
AGRICULTURAL ECONOMICS NATIONAL EXIT EXAM
GUIDEBOOK
Table of Contents
1. Introduction .............................................................................................................................................................................. 2
2. Rational of the Guidebook........................................................................................................................................................ 3
3. Expected Profiles of Graduates ................................................................................................................................................ 3
4. Themes and courses to be included in the exit exam................................................................................................................ 4
6. Competence Areas, References and Sample Questions............................................................................................................ 7
6.1 Microeconomics I & II ..................................................................................................................................................... 7
6.2 Macroeconomics I & II .................................................................................................................................................. 13
6.3 Research Methods for Agricultural Economics.............................................................................................................. 21
6.4 Development Economics ................................................................................................................................................ 25
6.5 Econometrics .................................................................................................................................................................. 30
6.6 Operations Research in Agricultural Economics............................................................................................................ 35
6.7 Farm Management .......................................................................................................................................................... 38
6.8 Farming System and Livelihood Analysis...................................................................................................................... 42
6.9 Agricultural Project Planning and Analysis ................................................................................................................... 46
6.10 Natural Resource and Environmental Economics .......................................................................................................... 48
6.11 Agricultural Marketing ................................................................................................................................................... 50
6.12 International Agricultural Trade ..................................................................................................................................... 51
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1. Introduction
Ethiopian Ministry of Education has unveiled a plan to introduce exit exams in all undergraduate
university programs from the next academic year, starting June 2023. The ministry’s decision
can be regarded as a manifestation of decreasing trust in degrees acquired from universities and
student grades, both of which are no longer regarded as a true measurement of actual academic
capabilities. The proposed scheme appears to resemble a high-stakes exam. Students who do not
pass can be given additional opportunities to sit for another round of the exit exam but will not
be entitled to any form of employment unless they pass. The ministry believes that the scheme
will bring about attitudinal changes by discouraging students from rampant exam cheating and
helping them do their own work. As higher education institution, Debre Berhan Univesity is also
planned to offer exit exam for all undergraduate students in the next year.
Agricultural economics is among the undergraduate programs in the university. For making its
students’ competent to the exit exam, several preparations are now being made by the
department. One of these is preparing a guidebook that instructs students on what to read and
concentrate on. In order to prepare the guidebook, the Department of Agricultural Economics
used the new curriculum and competency focus areas identified by Ministry of Education. Thus,
the revised guide book includes such departmental core courses as Microeconomics I,
Microeconomics II, Macroeconomics I, Macroeconomic II, Operations Research in Agricultural
Economics, Econometrics, Research Methods in Agricultural Economics, Development
Economics, Farm Management, Farming Systems and Livelihood Analysis, Natural Resource and
Environmental Economics, International Agricultural Trade and Agricultural Marketing. The
guidebook consists of the leaning outcomes, core competencies, sample questions and references
for 14 courses having a total of 43 credit hours.
The national Agricultural Economics exit exam shall have the following objectives
 To produce skilled and competent manpower to national and international market

 Assessing students’ educational achievement in major areas of Agricultural Economics
 Ensuring whether the graduation profile of Agricultural Economics curriculum have achieved
at least common standards of knowledge and practical skills
 Improving public trust and confidence in Agricultural Economics activities of professionals
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 Facilitating the efforts of students to revise the core learning outcomes of the courses covered
by the exit examination
 Ensuring all graduates from higher education instiutions satisfy the requirements of the
labor market andemployability through the national wide implementation of competency-
based exit exam
 Creating competitive spirit among Agricultural Economics departments in Ethiopia with the
vies to encouraging them to give due attention to the national standards
2. Rational of the Guidebook
This guidebook is intended to help students prepare for the national exit exam. It is important to
set competency areas of the subject matter (program) in order to measure how much graduates
are acquired with skills, knowledge and attitudes. It offers a guide for what subjects and topics
students ought to study. Students, however, should not confine themselves to this guidebook
only. To be competent for the exit exam, students must have the detail handouts or reading
materials for each course. After finishing each course, students must assess their mastery of the
core competencies and their ability to respond to the sample questions that are presented in each
chapter of the courses.
3. Expected Profiles of Graduates
In general, the intended graduate of Agricultural Economics is expected to develop economic

information on farm production methods and technologies; the structure and efficiency of the
agricultural system; production linkages with processing, distribution, and final consumer
demand; agricultural trade and policy to assist farmers, agribusiness, and consumers in decision-
making; and to prepare dynamic careers in business. The curriculum combines economics and
agricultural fundamentals with insights into the dynamic social, technological, and
environmental forces that shape production and marketing decisions. Thus, the program aims to
produce qualified professionals who are knowledgeable, skilled and capable to work with
appropriate and desired attitude. Agricultural Economics graduates are expected to involve in
different tasks in the Agricultural and related sectors which demand their expertise. The
graduate/ professional profile of Agricultural Economics includes the ability to:
 Design, implement and evaluate agricultural development programs and projects;

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 Enhance sustainable agricultural development through effective and efficient mobilization

and utilization of the scarce resources;
 Undertake feasibility studies to advise investors, financial institutions, agriculture and allied
sectors;
 Undertake research and advise policy makers;
 Develop plans and strategies to enhance agricultural development;
 Advocate commercial agriculture, sustainable farming system and rural institutions for the
sustainable development of the country.
 Promote national and international agricultural trade;
 Train and advise small scale farmers and agricultural enterprises; and
 Teach at HEIs and technical and vocational training institutions.
4. Themes and courses to be included in the exit exam
S. Them List of major courses Cr. Hrs. Responsible
N es persons
1 Economics Microeconomics I 3 Ms. Eden, Ms. Meseret & Mr.
Microeconomics II 3 Yonas
Macroeconomics I 3 Mr. Girma & Mr. Biruk
Macroeconomic II 3
Development Economics 3 Mr. Yonas & Mr. Girma
Natural Resource and Environmental 3 Dr. Tadesse, Mrs. Meskerem &
Economics Mr. Mekonnen
2 Research Econometrics 4 Mr. Mekonnen & Mr. Girma
Research Methods in Agricultural 3 Dr. Tadesse & Dr. Debebe
Economics
Operational Research 3 Ms. Meseret & Ms. Eden
3 Marketing International Agricultural Trade 3 Ms. Eden & Mr. Biruk
Agricultural Marketing 3 Dr. Tadesse & Mr. Yonas
4 Agriculture Agricultural Project Planning and 3 Dr. Debebe & Mr. Girma
and policy Analysis
Farming Systems and Livelihood 3 Mr. Dawit & Dr. Debebe
Analysis
Farm management 3 Mr. Biruk & Mrs. Meskerem
Total Cr. Hrs. load 43
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5. Competencies and Learning Outcomes
After successful completion of the training, the graduates are expected to gain the following
competence:
5.1 Knowledge that enable them to:
 Participate in design, implementation and evaluation of agricultural development projects;

 Apply effective and efficient resource utilization theories and practices for sustainable
agricultural development;
 Involve in feasibility studies and advise investors, financial institutions, agriculture and allied
sectors;
 Assist researchers and policy makers in agricultural production and productivity; marketing
and sustainable use of natural resource and environment;
 Train and advise small scale farmers and agricultural entrepreneurs;
 Serve as planners in agricultural offices;
 Manage small scale farms and agricultural enterprises;
 Work as agricultural expert team leader, market expert, bank manager, policy maker and loan
officer; and
 Assist teaching at higher institutions, and technical and vocational training institutions.
 Formulate and advocate climate change and agricultural development policies and strategies
5.2 Skill that enable them to:
 Use conceptual skill in understanding the complex interrelationship between agriculture

sector and with the other economic sectors.
 Use marketing intelligence skills in acquiring, analyzing and disseminating agricultural
development and marketing information.
 Practice analytical skills of research methodology, economic models and software’s in the
efficient resource utilization, agricultural development, marketing and business research and
innovation activities.
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5.3 Attitude that enable them to:
 Perceive the importance of agricultural development for economic growth of a country.

 Appreciate agricultural development in social, economic, environmental, cultural and
political context.
 Develop sense of enthusiasm to work with farmers, traders, bankers and managers in
agricultural economics areas.
 Appreciate the agricultural profession and to be dedicated agricultural economist who love
his profession.
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6. Competence Areas, References and Sample Questions
6.1 Microeconomics I & II

6.1.1 Competencies and Learning Outcomes
After successful completion of the course, the students are expected to gain the following
competence:
Areas of Competency Expected Competencies to be achieved

Knowledge  Describe basic concepts of economics;
 Distinguish scarcity and opportunity costs;
 Construct the theories of demand and supply,
 Investigate consumers behavior and utility maximization,
 Estimate profit maximization and cost minimization,
 Apply basics of market structures and equilibrium price and output
determination under perfect competitive and monopoly models.
 Examine the key features of monopolistic competitive and oligopolistic
market structures;
 Explain how equilibrium prices and outputs are determined under
monopolistic competitive and oligopolistic market structures.
 Determine factor prices under both perfect and imperfect markets.
 Evaluate why markets fail and how government reacts
 Describe concepts of game theory
 Construct concepts of general equilibrium and welfare economics.
Skill  Apply the concept of scarcity of resources and opportunity cost in making
choice
 Apply the theories of demand and supply
 Apply the theories of utility and consumer behaviour
 Understand theories of production
 Comprehend different types of production relationships
 Understand theory of costs and cost curves with production curves
 Explain market structures and basics of market structures Learn the basic
features of monopolistic competitive market
 Understand different models of oligopolistic market
 Establish factor prices under perfect and imperfect market structures
 Recognize elasticities of input substitutions, technological progress and
income distributions
 Apply the strategic behavior of oligopolistic market
Attitude Think like an economist
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6.1.2 Reference Materials
 Hal Varian. 2005. Intermediate Microeconomics, A modern Approach 7th Edition

 David Besanko and Ronald R. Braeutigam. 2011. Microeconomics 4th edition
6.1.3 Sample Questions
Instruction: Choose the Best Answer among the Given Alternatives
1. Economics is the study of

A. How society manages its unlimited resources
B. How to reduce our wants until we are satisfied
C. How society manages its scarce resources
D. How to fully satisfy our unlimited wants
2. Which of the following is the feature of a command economic system?
A. There is no government intervention
B. Market forces, demand and supply factors govern the economic activities
C. Decision making is centralized.
D. All of the above
3. Supply reflects the quantity that producers:
A. Produce at alternative prices
B. Sell at alternative prices
C. willing and able to produce and offer to sell at alternative prices
D. All of the above
4. is cost per unit of production.
A. Marginal cost.
B. Average cost.
C. Fixed cost.
D. Cost of production.
5. Price discrimination can take place when;
A. A monopolist has to have power.
B. Separation of market must be attainable.
C. Redistribution of product must be forbidden.
D. All of the above.
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6. is the extra output (ΔTPP) produced by employing one more unit of the variable
factor.
A. Average physical product
B. Marginal physical product
C. Production function
D. Total physical product
7. Which of the following is true about the relationship between production and cost?
A. TVC and TP are directly related.
B. AVC and AP are inversely related.
C. MC and MP are directly related.
D. None of the above.
8. Which of the following is not part of the opportunity cost of going on holiday?
A. The money you spent on a theatre show there
B. The money you could have made if you had stayed at home and worked
C. The money you spent on food
D. The money you spent on airline tickets
9. Points on the production possibilities frontier are
A. Inefficient.
B. Normative
C. Unattainable
D. Efficient
10. If the price of a good is above the equilibrium price,
A. There is a surplus and the price will rise.
B. There is a shortage and the price will fall.
C. There is a shortage and the price will rise.
D. The quantity demanded is equal to the quantity supplied and the price remains
unchanged.
11. All of the following shift the supply of watches to the right except
A. An advance in the technology used to manufacture watches.
B. An increase in the price of watches.
C. A decrease in the wage of workers employed to manufacture watches.
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D. Manufacturers' expectation of lower watch prices in the future.

12. Suppose a frost destroys much of a country’s orange crop. At the same time, suppose
consumer tastes shift toward orange juice. What would we expect to happen to the
equilibrium price and quantity in the market for orange juice?
A. Price will decrease; quantity is ambiguous.
B. The impact on both price and quantity is ambiguous.
C. Price will increase; quantity will decrease.
D. Price will increase; quantity is ambiguous
13. An inferior good is one for which an increase in income causes
A. Decrease in supply.
B. Increase in demand.
C. Increase in supply.
D. Decrease in demand.
14. Which of the following would cause a demand curve for a good to be price inelastic?
A. The good is a luxury.
B. There are a great number of substitutes for the good.
C. The good is a necessity.
D. None of these answers.
15. In which of the following model optimal decision by firms is made simultaneously
A. low cost price leadership
B. Bertrand duopoly model
C. Stackelberg duopoly model
D. Dominant firm price leadership
16. In which one of the following duopoly model the strategic interaction between firms is made
on quantity of output produced.
A. low cost price leadership
B. Stackelberg duopoly model
C. Bertrand duopoly model
D. Dominant firm price leadership
17. All of the following oligopoly model have something in common except
A. Cournot‘s duopoly model
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B. Bertrand duopoly model

C. Kinked demand curve model
D. Stackelberg duopoly model
18. Excess capacity under monopolistic competition is
A. When in the long run, firms will produce at an output below their minimum-cost point.
B. When P=MC cannot be achieved
C. When the firms are efficient
D. When firms could use full capacity
19. Which of the following is not an oligopolistic barrier to entry?
A. Advertising and patents
B. High start-up costs
C. Control over essential resources
D. Diseconomies of scale
20. is an oligopoly model in which one firm sets a price and others in the industry
also charge that price.
A. Cartel
B. Price leadership
C. Cournot
D. Bertrand
21. Which one of the following condition is necessary for ideal efficiency?
A. All activities that provide individuals with more benefits than costs must be undertaken.
B. All activities that provide benefits less than costs should be undertaken.
C. No activities that provide individuals with more benefits than costs must be undertaken.
D. All of the above
22. Factors of production include;
A. Land, capital, and interest
B. Land, interest, and rent
C. Land, labor, and capital
D. Labor, capital, and profits
23. Which one of the following is a type of government interventions?
A. Establish property rights
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B. Subsidies
C. Transfer payments
D. All
24. Which one of the following is true about the market demand for a variable input?
A. It is different from the market demand for a commodity.
B. It is the sum total of the individual firms demand.
C. Individuals/ people are making demand decisions.
D. None of the above
25. One of the following is correct about markets?
A. It facilitates exchange of goods and services.
B. It seeks efficient resource allocation across alternative uses.
C. It facilitates transactions.
D. All
26. Which one of the following is true about the productive role of government?
A. Enforcement of contracts and a mechanism for the settlement of disputes.
B. The provision of a limited set of goods difficult to supply through the market.
C. Protect individuals and their property against invasions by others.
D. All of the above
27. For which one of the following situations is the game theory applied?
A. The study of oligopolies
B. The study of externalities and public goods
C. The study of military strategies
D. All
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6.2 Macroeconomics I & II

competences:
Knowledge  Understand the subject matter of Macroeconomics and its components,
 Identify and discus the schools of thoughts in Macroeconomics,
 Describe the application of national income accounting system,
 Explain how aggregate variables are measured and related to each
other,
 Discuss how the equilibrium real GDP and price level determined from
the interaction of aggregate demand and supply curves
 Describe the major macroeconomic problems
 Explain the major macroeconomic policies that government and
monetary authorities apply to stabilize the economy,
 Discuss the theories of consumption, investment and its effect on
national income determination.
 Explain the role of money in an economy
 Explain the IS and LM curves and how the monetary and fiscal policy
instruments stabilize the economy
 Describe balance of payment and types of exchange rates
 Explain growth and development issues in macroeconomics.
 Explain terms inflation, unemployment, equitable distribution of
income , balance of payment, stable and sustainable economic
development
Skill  Use different techniques of measuring national income.

 Apply the techniques of national income accounting to forecast
economic growth, to help policy formulation, economic planning
 Use National Income Data to fix development targets and formulate
plans,
 Develop a skill to draw and interpret the aggregate demand and supply
curves from a given economic data, and equilibrium condition
 Develop a technique to draw and interpret the curves of Long run and
Short run equilibrium aggregate supply and demand curves
 Apply different theories to explain Business cycle (Keynesian theory,
Monetarist Theory, Rational Expectation Theory, Real Business Cycle
Theory and Political Business Cycle
 Use curves or graphs to demonstrate business cycles.
Attitude  Listen attentively all macroeconomic lecture sessions
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 Respond to questions raised in macroeconomics lecture class

 Value and appreciate Macroeconomics schools of thoughts (Classical,
neo-classical ,Keynesian school of thoughts, New classical and New
Keynesians)
 Solve the real problem of the society by using econometric models.
 Appreciate the professionals of statisticians and econometricians an act
like them.
 Mankiw, N. G., 2016. Macroeconomics, 9th ed., Worth Publishing, U.S.A.

 Dornbusch, R., S. Fischer and R. Startz, 2002. Macroeconomics, 8th ed., Tata McGraw-Hill
Edition.
1. The IS curve is
A. Downward slopping.
B. Upward slopping.
C. Linear slopping.
2. Which one is used to implement macroeconomic policy?
A. Fiscal policy.
B. Monetary policy.
C. Both A and B.
3. What would be the overall effect on aggregate output if there is an increase in the planned
investment spending?
A. The aggregate output will increase by an amount that is less than the change in
investment spending
B. The aggregate output will increase by an amount that is greater than the change in
investment spending
C. The aggregate output will increase by an amount that is equal to the change in investment
spending
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D. The aggregate output will decrease by an amount that is less than the change in
investment spending
4. Which of the following statements is accurate about the free market in a nation’s economy?
A. It is an economy with minimal intervention from the government in trade and minimal
regulations
B. It is an economy with maximum intervention from the government in trade and
maximum regulations
C. It is an economy with maximum intervention from the government in trade and minimal
regulations
D. It is an economy with minimal intervention from the government in trade and maximum
regulations
5. Which of the following activities is not included in the calculation of the national income of a
country?
A. A maid working for a family on a full-time basis
B. A lawyer conducting their law practice
C. A housewife performing housework chores
D. A dispensary rendering medical services
6. Which of the following is true about the rate of interest under classical theory?
A. The rate of interest is based on the demand of investment and the supply of money
B. The rate of interest is based on the demand of investment and the price level
C. The rate of interest is based on the demand for capital and the supply of savings
D. The rate of interest is based on the demand for money and the supply of money
7. Which of the following statements is accurate about the two-sector economy?
A. The two-sector economy consists of firms and the government
B. The two-sector economy consists of firms and foreign sector
C. The two-sector economy consists of households and government
D. The two-sector economy consists of households and firms
8. Which of the following statements is accurate about the relation between indirect taxes and
subsidies?
A. If the factor cost is greater than the market price, then indirect taxes are less than
subsidies
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B. If the factor cost is greater than the market price, then indirect taxes are greater than
subsidies
C. If the factor cost is greater than the market price, then indirect taxes are equal to subsidies
9. What is the role of monetary policy?
A. It stabilizes the money
B. It stabilizes the problem of unemployment.
C. Same as fiscal policy.
10. Which of the following measures are adopted to take care of inflation in an economy?
A. Decrease in transfer payments along with a reduction in taxation
B. Increase in transfer payments along with an increase in taxation
C. Decrease in government expenditure along with an increase in taxation
D. Increase in government expenditure along with a decrease in taxation
11. Which of the following methods must be adopted to tackle the problem of recession within
an economy?
A. Reduce the public borrowing and increase taxation
B. Increase the public borrowing and reduce taxation
C. Reduce the spending on government welfare projects and increase taxation
D. Increase the spending on government welfare projects and reduce taxation
12. Fiscal policy is the use of …. revenue and expenditure.
A. Government’s
B. Private organizations.
C. Public-private firms.
13. Which of the following statements are true about the study of macroeconomics?
A. It is a study of economics that deals with households, government, firms and demand-
supply
B. It is a study of economics that deals with households, government, firms and the external
sector
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C. It is a study of economics that deals with price levels, profit, expenditure and cost
14. Which of the following statements reflects the true meaning of gross investment?
A. Gross investment is the total of net investment and depreciation
B. Gross investment is the difference between the net investment and depreciation
C. Both a and b are correct
D. Both a and b are incorrect
15. Microeconomics is the study of a single unit or a single firm whereas the macroeconomics is
A. The study of national economy as whole.
B. The study of regional economy as whole.
C. International economics.
16. Consumption function depends on:
A. Size of income.
B. Propensity to consume.
C. Both A and B.
17. Which is not a subject of macroeconomics?
A. GDP.
B. National income.
C. Budget constraints of a firm.
D. Inflation.
18. What is the role of fiscal policy?
A. It stabilizes the economy.
B. It stabilizes the problem of unemployment.
C. Both A and B.
19. Investment Function depends on:
A. Size of firm.
B. Price of good.
C. Time.
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D. Marginal efficiency of capital.

20. Who is the father of macroeconomics?
A. Milton Friedman
B. Adam Smith.
C. J. M. Keynes.
D. David Ricardo.
21. The AS – DS model explains
A. Price level
B. Output.
C. Both A and B.
D. Aggregate demand and supply.
22. The IS curve comprises of
A. Income.
B. Interest rate.
C. Both A and B.
23. Who implements monetary policy in Ethiopia?
A. National Bank of Ethiopia.
B. Ministry of Finance.
C. Ministry Revenue.
D. World Bank.
24. Taxes and debts are the tools of
A. Income policy.
B. Monetary policy.
C. Supply-side economics.
D. Fiscal policy.
25. The consumer price index is the measure of.
A. Investment cost.
B. Living cost.
C. Expenses cost.
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26. The reduction in the value of Plant and Machinery during the process of manufacturing is known as
A. Net National Product
B. Gross Domestic Product
C. Depreciation
D. Consumption
27. Gross Domestic Product is a sum of
A. Net National Product, Disposable Income and Gross National Product
B. Investment, Consumption, Government Purchases and Net Exports
C. Investment, Wages, Profits and Intermediate Production
D. All of the Above
28. The sum of the market value of sums up to be Gross Domestic Product
A. Normal Goods and Services
B. Final Goods or Services
C. Intermediaries
D. All of the Above
29. Which of the following comes under GDP?
A. Illegal Drug Sales
B. Housework
C. An off from work
D. Consulting Services
30. Which of these can be used to measure inflation?
A. Producer Price Index
B. Consumer Price Index
C. Gross Domestic Product Deflator
D. All of the above
31. If inflation is at 3% and the Nominal Interest rate is at 8%. What is the real rate of interest?
A. 1%
B. 11%
C. 5%
32. With an increase in the salary, the standard of living is likely to
A. Stay the same
B. Rise
C. Decline
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D. Not Related
33. The consumer price index is based on
A. Consumer Production
B. Total Current Production
C. Products purchased by a typical consumer
34. In which condition would it be better to be the borrower?
A. The nominal rate of interest is 12% and inflation is 9%
B. The nominal rate of interest is 15% and inflation is 8%
C. The nominal rate of interest is 20% and inflation is 25%
D. The nominal rate of interest is 15% and inflation is 14%
35. A logical measure of the Standard of Living in a country is?
A. Real GDP per person
B. Nominal GDP per person
C. Real GDP
D. Nominal GDP
36. The opportunity cost of growth is?
A. Reduction in current saving
B. Reduction in current consumption
C. Reduction in Taxes
37. When government spending exceed the amount of tax collected,
A. There is a budget deficit
B. There is a budget surplus
C. Private saving is positive
D. Public saving is positive
38. Saving is equal to
A. Investment + Consumption Expenditure
B. Private Saving + Public Saving
C. GDP + Consumption Exp. + Gvt Expenses
D. None of the Above
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6.3 Research Methods for Agricultural Economics

competence:

Knowledge  Define research
 Know and explain basic concepts of research, types of research and the
importance of the research.
 Define and understand quantitative and qualitative research methods in
Agricultural Economics.
 Describe and compare different research paradigm based on their
methodological strength and weakness
 Explain the relationship between theory and research process and the
role of theory in guiding practical research.
Skill  Be able to formulate and identify research problem identification

techniques
 Select and apply research paradigm in problems in Agricultural
Economics
 Construct an effective data collection tools for both qualitative and
qualitative research.
 Follow standard procedure to make research
 Use appropriate sampling techniques for his senior research proposal
preparation
Attitude  Listen attentively lecture of research method
 Appreciate different research paradigms
 Imitate the works of researchers in their field of study
 Develop affection towards career of researcher in agriculture.
 Ranjit Kumar. 2005. Research Methodology: A step-by-step guide for beginners. London.
Sage Publications 2. C.R.
 Kothari. 2004. Research Methodology: Methods and Techniques. Second Revised Edition.
 Guajarati, Damodar N. 2001. Basic Econometrics, : McGraw-Hill
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1. In any research process the first task is .
A. Developing a research design

B. Formulating a research question
C. Deciding about the data analysis procedure
D. Formulating a research hypothesis
E. None of the above
2. The depth and width of the research is determined by .
A. Research title
B. Research budget and duration
C. Research objectives
D. Total expenditure on research
3. Research is defined as .
A. A prerequisite to have an academic degree.

B. Searching again and again
C. Working in a scientific way to search for solution of a problem
D. A means of driving income for the researcher
E. A means of refuting previous ideas.
4. The main purpose of _ research is to acquire knowledge.
A. Descriptive
B. Correlational
C. Explanatory
D. A and B
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5. Why do you need to review the existing literature?
A. To make sure you have a long list of references

B. To entertain your self
C. To find out what is already known about your area of interest
D. To help in your general studying
E. Because it helps to find funding agency
6. A document that presents the research objectives, plan of achieving these objectives, and the
expected outcomes of the study is called .
A. Research design
B. Research problem
C. Research proposal
D. Research hypothesis
E. Research report
7. A variable in research that assumes only two values is called
A. Categorical variable
B. Dummy variable
C. Independent variable
D. Dependent variable
E. Closed ended variable
8. Questionnaire is filled by .
A. Respondent
B. Researcher
C. Everybody
D. Enumerator
9. Which one is called non-probability sampling?
A. Cluster sampling
23
B. Systematic sampling
C. Stratified random sampling
D. Quota sampling
E. Simple Random Sampling
10. The formal sequence of a research report is represented by .
A. Introduction; Data Collection method ; Data Analysis; Conclusions and

Recommendations
B. Executive Summary; Literature Review; Data Gathered; Conclusions; Bibliography
C. Research Plan; Research Data; Analysis; References
D. Executive summary , Introduction, Literature Review, Research Methodology, Results,
Discussions , Conclusions and recommendation
E. Executive summary, Introduction, Literature Review, Research Methodology ,
conclusion and recommendation
24
6.4 Development Economics

competence:
Knowledge  Explain the characteristics of underdevelopment;

 Compare the classical and structural change economic development
theories;
 Identify the economic development policy concepts and principles;
 Define the relevance of population in the process of economic
development;
 Judge the dimensions of unemployment and its implication for economic
development; and
 Discuss the internal rural-urban migration, its socio-economic factors and
characteristics.
Skill
 Apply the Physical Quality of Life Index and how it is used as a measure
of development;
 Design the Human Development Index and how it is used as measure of
development;
 Use the importance of knowing income distribution, the Lorenz curve and
the Gini coefficient;
Attitude
 Differentiate the meaning of economic growth and economic development;
 Describe the institutional and economic structural changes in the process
of development;
 Revise the imperative and challenges of agricultural development;
 Verify the relevance of education and health for development;
25
 Todaro, M.P (1997), Economic Development

 Jonnes, C.I (2002), Introduction to Economic Growth, 2nd edition
 Arndt, H.W. (1981). "Economic Development: A Semantic History," Economic
Development and Cultural Change: The Chicago University Press
 Debraj Ray (1998). Development Economics, Princeton University Press,
1. The study of economic development concerns?

A. The economic development problems of developing countries
B. The efficient allocation of scarce resources
C. the economic and institutional mechanisms for economic development
D. the improvements in the living standards of the masses of peoples
E. all of the above
2. The objectives of economic development are?
A. To increase the availability of basic needs
B. To raise levels of living
C. To expand the range of economic and social choices
D. All of the above
3. One of the following is correct about economic growth?
A. It is taken to mean growth plus change
B. It is quantitative sustained increase in the per capita output
C. It concerns improvement in quality of life
D. It is a continuous and spontaneous change
E. All of the above
4. The structural changes in the process of economic development are?
A. Increased application of human capital and knowledge
B. Undertaking essential institutional change
C. Changing trade patterns
26
D. Increase in industrialization.
E. All except C
F. All of the above
5. The term development means?
A. Decrease in poverty and malnutrition
B. Improvement in life expectancy and literacy
C. Attitudes and cultural changes
D. The expansion of human freedoms
E. All of the above
6. The necessary GNI adjustments if to be used in measuring development are?
A. Changes in price and population growth
B. Externality and non-marketable goods and services
C. The distribution of GNI among the population
D. The normal exchange rate
E. All of the above
7. The Physical Quality of Life Index is a composite index of?
A. Infant mortality, life expectancy and basic literacy
B. Food calorie supply, Infant mortality and sanitation
C. Longevity, educational attainment and real per capita GDP
D. Literacy, food calorie supply and infant mortality
E. All of the above
8. The concept of human development emphasized that development is?
A. About enlarging people’s choices
B. For the people and by the people
C. Must be woven around people
D. All of the above
9. Social indicators include except?
A. Food and water supply
B. GNI per capita
C. Health and education
D. Sanitation and housing
27

10. The Gini coefficient calculated for country A is found to be 0.25. Country A, therefore?
A. Highly unequal income distribution
B. Perfect income equality
C. Relatively equitable income distribution
D. Perfect income inequality
11. An under developed country is one which has?
A. No prospects of development
B. No potentialities of development
C. Conditions are abnormal but perhaps readily rectifiable
D. Low level of per capita income
E. All except A
F. All of the above
12. One of the following is a characteristic of a dual economy?
A. Market-oriented and non-market oriented economy
B. The traditional agricultural and modern industrial sectors
C. Unorganized and organized financial market system
D. Developed and less developed in all amenities of life
E. All of the above
13. Almost all the underdeveloped countries characterized by except?
A. Unutilized or underutilized natural resources
B. High birth-rate and high but declining death-rate
C. Overcoming the scarcity of natural resources
D. Diversity in the size, age-structure and the growth rate of population.
14. The feature of unemployment in the underdeveloped countries includes?
A. Open unemployment
B. Disguised unemployment
C. Both voluntary and involuntary unemployment
D. All of the above
15. The manifestation of economic and technological backwardness is?
28
A. high labor efficiency

B. limited specialization
C. high labor-output
D. low capital-output ratios
E. B and D
F. All of the above
16. The doctrine of Adam Smith regards?
A. Every person as the best judge of his self interest
B. An effective competitive environment is essential for growth
C. The division of labor results in the greatest improvement productivity
D. Save and invest are necessary for economic growth
E. All of the above
17. According to Ricardian theory, capital accumulation depends on?
A. The capacity to save
B. The will to save
C. The net income of society
D. All of the above
18. The requirements of the take-off suggested by Rostow are except?
A. The rise in saving and investment
B. The development of one or more agricultural sectors
C. The existence of socioeconomic framework that impulses growth
D. All of the above
19. In the Schumpeterian theory, an innovation may consist the introduction of?
A. A new product
B. A new method of production
C. The new organization of any industry
D. All but C
E. All of the above
20. Which one is incorrect about Lewis theory?
29
A. There is perfectly elastic supply of labour at the subsistence sector

B. The marginal productivity of labour is negligible at the subsistence
C. The industrial sector wage level can be less than the subsistence sector
D. Earnings in the subsistence sector set a floor to wage in the capitalists sector
6.5 Econometrics
competence:
Knowledge  Apply the methodology of econometrics for research project.

 Investigate the properties of a good econometric model.
 Describe applications of coefficient of correlation and de
termination.
 Estimate the regression model using the real data and interpret the result.
 Construct the different violations of OLS basic assumptions.
Skill  Apply basic software applications to solve econometric problems.

 Design and work econometric models on statistical software.
 Apply different estimation for panel and time series data by using
statistical software.
 Apply critical socio-economic phenomenon observation and data analysis
skills
 Use appropriate statistical analysis of data, and explain the statistical
problems involved.
 Practice analytical skills of methodology of econometric models and
software’s in the efficient resource utilization, agricultural development,
marketing and business research and innovation activities.
 Display the results of regression models and interpret the output of
regression models.
Attitude  Solve the real problem of the society by using econometric models.
 Appreciate the professionals of statisticians and econometricians and act
like them.
30
 Koutsoyiannis, 2001. Theory of Econometrics, 2nd edition.

 Gujarati, D.N (2004). Basic Econometrics. 4th Edition. McGraw-Hill companies, Inc.
 Greene, W. H. (2002). Econometric Analysis. 5th Edition. Macmillan, New York
 Maddala, G.S. (1992). Introduction to Econometrics. 2nd Edition.
1. If there is a very strong correlation between two variables then the correlation coefficient must
be
A. Any value larger than 1
B. Much smaller than 0, if the correlation is negative
C. Much larger than 0, regardless of whether the correlation is negative or positive
D. None of these alternatives is correct.
2. In regression, the equation that describes how the response variable (y) is related to the
explanatory variable (x) is:
A. The correlation model
B. The regression model
C. Used to compute the correlation coefficient
3. The relationship between number of beers consumed (x) and blood alcohol content (y) was
studied in 16 male college students by using least squares regression. The following regression
equation was obtained from this study:
Y^= -0.0127 + 0.0180x
The above equation implies that:
A. Each beer consumed increases blood alcohol by 1.27%
B. On average it takes 1.8 beers to increase blood alcohol content by 1%
C. Each beer consumed increases blood alcohol by an average of amount of 1.8%
D. Each beer consumed increases blood alcohol by exactly 0.018
31
4. In the case of an algebraic model for a straight line, if a value for the x variable is specified,
then
A. The exact value of the response variable can be computed
B. The computed response to the independent value will always give a minimal residual
C. The computed value of y will always be the best estimate of the mean response
5. You studied the impact of the dose of a new drug treatment for high blood pressure. You think
that the drug might be more effective in people with very high blood pressure. Because you
expect a bigger change in those patients who start the treatment with high blood pressure, you
use regression to analyze the relationship between the initial blood pressure of a patient (x) and
the change in blood pressure after treatment with the new drug (y). If you find a very strong
positive association between these variables, then:
A. There is evidence that the higher the patients initial blood pressure, the bigger the impact of
the new drug.
B. There is evidence that the higher the patients initial blood pressure, the smaller the impact of
the new drug.
C. There is evidence for an association of some kind between the patient’s initial blood pressure
and the impact of the new drug on the patients’ blood pressure
D. None of these are correct, this is a case of regression fallacy
6. The correlation between two variables is given by r = 0.0. What does this mean?
A. The best straight line through the data is horizontal.
B. There is a perfect positive relationship between the two variables
C. There is a perfect negative relationship between the two variables.
D. All of the points must fall exactly on a horizontal straight line.
7. For which one of these relationships could we use a regression analysis? Only one choice is
correct.
A. Relationship between weight and height.
32
B. Relationship between political party membership and opinion about abortion.
C. Relationship between gender and whether person has a tattoo.
D. Relationship between eye color (blue, brown, etc.) and hair color (blond, etc.).
8. Which of the following is a possible value of r2 and indicates the strongest linear relationship
between two quantitative variables?
A. 90%
B. 0%
C. 80%
D. 120%
9. Correlation and regression are concerned with
A. The relationship between two categorical variables.
B. The relationship between two quantitative variables.
C. The relationship between a quantitative explanatory variable and a categorical response

variable.
D. The relationship between a categorical explanatory variable and a quantitative response

variable.
10. Which one of the following is not appropriate for studying the relationship between two
quantitative variables?
A. Scatterplot
B. Bar chart
C. Correlation
D. Regression
33
11. In the following equation, GDP refers to gross domestic product, and FDI refers to foreign
direct investment. log(GDP) = 2.65 + 0.527*log(bankcredit) + 0.222FD
(0.13) (0.022) (0.017)
Which of the following statements is then true?
A. If FDI increases by 1%, GDP increases by approximately 22.2%, the amount of bank credit
remaining constant.
B. If FDI increases by 1%, GDP increases by approximately 26.5%, the amount of bank credit
remaining constant.
C. If FDI increases by 1%, GDP increases by approximately 24.8%, the amount of bank credit
remaining constant.
D. If FDI increases by 1%, GDP increases by approximately 52.7%, the amount of bank credit
remaining constant.
12. Which of the following correctly identifies an advantage of using adjusted R2 over R2?
A. Adjusted R2 corrects the bias in R2
B. Adjusted R2 is easier to calculate than R2
C. The penalty of adding new independent variables is better understood through adjusted R2
than R2
D. The adjusted R2 can be calculated for models having logarithmic functions while R2 cannot be
calculated for such models.
34
6.6 Operations Research in Agricultural Economics

competence:

Knowledge The students will be able to
 Describe Applications of operations research.
 Apply linear programming model for analysing operational problems in
business (particularly in agricultural firms).
 Propose suitable decisions to resolve conflicts of interest among various
sections of the organizations by seeking out optimal solution.
 Apply the concept of sensitivity analysis to allocate scarce resources
efficiently in agricultural firms.
 Apply the concept of transportation problem to allocate different
resources to activities if the resource requires more than activity.
Skill  Use conceptual skill in understanding the complex interrelationship
between agriculture sector and with the other economic sectors.
 Use interpersonal skill to solve the real-world problems in Agriculture.
 Implement and solve models using QM and Excel software.
Attitude  Solve problems in agriculture that needs decisions.
 Hillier, F.S. and Liberman,G.J (200l). Introduction to Operations Research (7th Edition)
McGraw-Hill Higher Education, Boston.
 Barry Render, Ralph M. Stair, Jr., Michael E. Hanna, and Trevor S. Hale, (2015).
Quantitative Analysis for Management, 12th edition,. ISBN 978-0-13-350733-1,
USA.
1. A feasible solution to a linear programming problem .

A. Must satisfy all the constraints of the problem simultaneously.
B. Need not satisfy all of the constraints, only some of them.
C. Must be a corner point of the feasible region.
D. Must optimize the value of the objective function.
35
2. Non-negativity restriction in LPP indicates that

A. All decision variables must take on values equal to or greater than zero
B. A positive coefficient of variables in objective function
C. A positive coefficient of variables in any constraint
D. Non-negative value of resources
3. If the primal problem has n constraints and m variables then the number of constraints in the
dual problem is .
A. mn
B. m+n
C. m-n
D. m/n
4. The right-hand side constant of a constraint in a primal problem appears in the corresponding
dual as .
A. A coefficient in the objective function
B. A right-hand side constant of a function
C. An input output coefficient a left-hand side constraint
D. Coefficient variable
5. The solution to a transportation problem with m-sources and n-destinations is feasible if the
numbers of allocations are .
A. m+n
B. mn
C. m-n
D. m+n-1
6. The allocation cells in the transportation table will be called cell.
A. Occupied
B. Unoccupied
C. No
D. Finite
7. The transportation problem is balanced, if .
A. Total demand and total supply are equal and the number of sources equals the number
of destinations.
36
B. None of the routes is prohibited.

C. Total demand equals total supply irrespective of the number of sources and
destinations.
D. Number of sources matches with number of destinations.
8. When the sum of gains of one player is equal to the sum of losses to another player in a
game, this situation is known as .
A. Two-person game
B. Two-person zero-sum game
C. Zero-sum game
D. Non-zero-sum game
9. Which of the following is an assumption of game theory?
A. The players act rationally and intelligently
B. Each payer has a finite set of possible courses of action
C. The players attempt to maximize gains or minimizes losses
D. All of the options
10. Which of the following represent constrained optimization techniques?
A. The theory of constraints.
B. The economic order quantity model.
C. The quality cost conformance model.
D. B. and C.
37
6.7 Farm Management

competence:
Areas of competency Expected Competencies to be achieved

Knowledge  Use to knowledge of Farm Management for practical problem
 Investigate Some Farm Management problems under Ethiopian condition
 Describe major Types of Production Relationships
 Apply the Basic Concepts of Costs in Farm Management
Skill  Use appropriate concepts of economics, accounting and Management for

solving Problems of agriculture
 Display the knowledge of Farm Management acquired via other
disciplines for practical problems existed
Attitude  Solve the problems of farm recording and analysis for profit maximization
and resource allocation
 Appreciate the interdisciplinary nature of Farm Management course and
act like them
 Cramer, G.L.; Jensen, C.W.; and Southgate, D.D. (1997) Agricultural Economics and
Agribusiness (7th edition). John Willy & Sons inc. New York
 Ronald D. Kay and William M. Edwards, 1999. Farm Management (4th edition).
WCB/McGraw Hill.
 V.T. Raju, & D.V.S. Rao (1990), Economics of Farm Production and Management, Oxford
& IBH publishing co., New Delhi, India
1. A firm should shut down in the short-run if it cannot cover its

A. Fixed cost
B. Total cost
C. Variable cost
D. Time cost
E. Overhead costs
2. The best indication that a farmer is making financial progress year-to-year is
38
A. An increase in net worth on the balance sheet

B. A decrease in the value of total liabilities on the balance sheet
C. An increase in the value of total assets on the balance sheet
D. An increase of total cash flow on the cash flow statement
E. A decrease in the value of his non-current liabilities
3. When an increase in production of one enterprise causes a reduction in the production of
another enterprise, the two enterprises are said to be:
A. Independent
B. Complementary
C. Supplementary
D. Competitive
4. The best measure of a firm's ability to make a short-term loan payment is
A. Debt/asset ratio
B. Current ratio
C. Solvency ratio
D. Leverage ratio
E. Net capital ratio
5. A farmer is solvent
A. He has sufficient current assets to cover current debts
B. He has sufficient equity to cover debts
C. He has sufficient assets to cover all debts
D. He can pay all debts with all equity
E. He can pay off long term obligations within 30 years
6. If the price of a commodity increases by 5% and the quantity purchased decreases by 10%,
then the demand for this commodity is:
A. Upward sloping
B. Inelastic
C. Elastic
D. Unitary
E. Unstable
39
7. A farmer has total assets of $400,000 of which land is $300,000. The farmer's debt: equity
ratio is 3:1. What will the farmer's debt: equity ratio be if his land goes up in value by 15%?
A. 0.75
B. 0.92
C. 1.18
D. 2.07
E. 2.45
8. To provide protection against wind damage to the farm home, a person should purchase
A. Life insurance
B. Property insurance
C. Accident and health insurance
D. Liability insurance
9. Which one of the following is not an object of farm management?
A. Minimization of losses and damages.
B. Minimization of inefficiency
C. Maximization of profit
D. Maximization of cots.
10. How to produce is the study of
A. Factor – factor relationship.
B. Resource – resource relationship.
C. Either A or B
D. Factor – product relationship.
11. What to produce or which enterprise to select is the subject of …. relationship
A. Factor – product relationship.
B. Product – product relationship.
C. Product – resource relationship.
12. Which principle applies on factor – product relationship?
A. Principle of diminishing return.
B. Principle of substitution.
40
C. Principle of opportunity cost.

13. The production decision how much produce is
A. Enterprise selection.
B. Optimum level of resource use
C. Both A and B
14. The production decision how to produce is
B. Optimum level of resource use.
C. Least cost method.
15. The production decision what to produce is..
B. Last cost method.
C. Both A and B
41
6.8 Farming System and Livelihood Analysis

After successful completion of the course, the students are expected to gain the followingcompetence:
Knowledge  Recall the concepts of agriculture and society;
 Identify classification of agricultural systems;
 Compare agricultural systems versus farming systems;
 Understand farming system research (FSR)
 List characteristics of farming systems approach
 List types of farming systems;
 Describe sustainable livelihoods and farming systems;
 Understand concepts of sustainable livelihoods and
 Discuss components of sustainable livelihood framework;
Skill  Develop models of livelihoods promotion;

 Undertake problem diagnosis and opportunities identification
 Apply participatory research tools and techniques
 Undertake comparison of livelihood frameworks;
Attitude  Investigate determinants of farming systems and sustainable livelihoods;
 Analyze principles of sustainable livelihood
 Classify, characterize and review farming systems;
 Evaluate methods of livelihood analysis;
 Examine smallholder, resource-poor family farms;
 Beets, W.C. 1990. Raising the Productivity of Smallholder Farming Systems in the Tropics.
 Beyan Ahmed and Hiwot mokonen.2014. Farming Systems and Livelihoods analysis. Course
Modue Haramaya university Ethiopia
 Jemal yusouf and Alemu sokora.2014. Farming Systems and Rural Livelihoods. Course
modue haramaya university Ethiopia
1. Which one is correct?

A. Reductionist approach failed in technology adoption for poor farmers
B. Green revolution had major impact on crop production in Sub Saharan Africa
C. Limited resource farmers cannot be involved in farming system research approach
D. System thinking emphasis on breaks a problem and solving each individually
42
2. One is not right about system approach
A. To be effective & innovative
B. To be proactive not reactive
C. To understand root causes of problems
D. Individualistic view than holistic view
3. Point out the one that is not under major system premises
A. Interdependence
B. Holism
C. Goal seeker
D. Boundary
E. None
4. It is not found under complex matrix of farming systems
A. Soils
B. Labour
C. Land
D. Capital
E. Management capacity
5. Identify the one that is under major categories of farmers
A. Irrigated farming system
B. Rain fed farming system
C. Dualistic farming system
D. Urban based farming system
E. All
6. Characteristics of farming system can be described as;
A. Farmers based
B. Problem solving
C. Interdisciplinary
D. Dynamic
E. Responsible to societies
43
F. All
7. What is/are the purposes of farming system research
A. To generate more appropriate technologies for farmers
B. Raise farm family welfare
C. Enhance society goal
D. All
8. What are the major activities of farming system research?
A. Target and research area selection
B. Problem identification and development of research base
C. Planning on farm research
D. On farm research & analysis
E. Extension of results
F. All
9. Select the one that is not a challenge of FSR/D
A. Incorporation of farmers
B. Evolution of farming system research
C. Incorporation of policy/support
D. Incorporating equity issues
E. Assessing agricultural research impact
10. What measures are needed to develop farming system and reduction of hunger and poverty;
A. Intensification of agricultural activities
B. Diversification of agricultural activities
C. Increasing off farm income
D. Expanded farm or herd size
E. All
11. Identify main determinants of farming system;
A. Natural resource & climate
B. Science and technology
C. Trade liberation & market development
D. Policies, institutions & public goods
E. Information & human capital
44
F. Indigenous technical knowledge

G. All
12. A livelihood comprises;
A. Creation of employment
B. Poverty reduction
C. Well-being & capability
D. All
13. It is not core principle of sustainable livelihood;
A. People centered
B. Holistic
C. Static
D. Sustainability
14. Determinants of livelihoods does not include;
A. Gender
B. Social setting
C. Resources
D. Capability
15. Components of livelihood analytical framework includes
A. Vulnerability
B. Livelihood assets
C. Policy, institutions & processes
D. Livelihood strategy
E. Livelihood outcomes
F. All
45
6.9 Agricultural Project Planning and Analysis

competence:
Knowledge  Understand the concept of agricultural projects, their features and their
role towards national development
 Analyze the different aspects of project preparation and analysis identify
different approaches to cost-benefit analysis of agricultural projects
 Describe the relationship between projects and programs
 Describe and analyze the major costs and benefits of agricultural projects
 Explain and analyze the financial and socioeconomic aspects of a project
 Identify and discuss the major methods of measuring project worth
 Describe agricultural project monitoring and evaluation tools
Skill  Develop the analytical and computational skills of students on the different
procedures for evaluating the impact of agricultural development projects
 Equip students with requisite skills for engaging in agricultural project
design using some logical framework analytical procedures;
 Expose students to the development and effective application of various
project concepts
 Enhance the skills of the students for using some proven financial
indicators for selecting among different agricultural development projects
Attitude  Understanding of their professional and ethical responsibilities as
agricultural project planner and analyst.
 Demonstrate critical-thinking problem-solving behaviours for agricultural
projects
 Effectively communicate the scientific and technical aspects of agricultural
projects in a professional manner
1. Which of the following is not categorized under preliminary expenses of a project?
46
A. Cost of preparing the feasibility study D. Cost of conducting market survey

B. Cost of identifying a project E. All of the above
C. Cost of office furniture F. None of the above
2. Of the following which is not rational for SCBA?
A. Market imperfection C. Merit wants E. All of the above
B. Externalities D. Taxes and subsidies F. None of the above
3. Which one of the following do not direct transfer payment?
A. Cost of inputs C. Credit transactions E. All of the above
B. Taxes and subsidies D. Depreciation allowance F. None of the above
4. Which of the following is wrong?
A. Taxes are costs in financial analysis
B. Taxes are excluded from economic analysis
C. Payment of taxes reduce the national income
D. Tax is direct transfer payment
E. All of the above
F. None of the above
5. Tangible benefits of a project includes the following except
A. Change in product form D. Increase in output produced
B. Quality improvement E. All of the above
C. Depreciation F. None of the above
6. A means of project financing offered by suppliers of plant and machinery to receive
payments over future period of time is known as
A. Differed credit
B. Bond capital
C. Share capital
D. Term loan
E. All of the above
F. None of the above
47

 Behrens, W. and P.Hawrank. (1991). Manual for the preparation of industrial feasibility studies. United
Nations Industerial Development Organizations (UNIDO).
 Chandra P. (1995). Projects: Planning, Analysis, selection, implementation and 4th edition. Tata McGraw-Hill
Publishing Company Limited, New Delhi.
6.10 Natural Resource and Environmental Economics
After successful completion of the course, the students are expected to gain the following competence:
Knowledge  Understand environmental issues from an economic perspective.

 Describe the theory of environmental and resource economics.
 Describe sustainability and sustainable development.
 Investigate efficiency and optimality.
 Apply valuation techniques to value the environment.
Skill  Apply economic tools to evaluate the allocation and utilization of natural resources
and the management of the natural environment.
 Practice skills to predict the effects of government policies and regulations, and
suggesting solutions to minimizing economic and environmental problems.
 Develop skills to critically evaluate environmental policy.
 Evaluate environmental and natural resource issues from the perspective of economic
theory.
 Examine how economists can value the environment and
 Apply economic principles to choose between development and conservation and
make optimal decisions about resource use.
Attitude  Demonstrate critical-thinking problem-solving skills for natural and environmental
resources
 Effectively communicate scientific and technical knowledge in a
 professional manner
 Understanding of their professional and ethical responsibilities as forest managers,
natural resources managers, environmental managers and the like.
48
 Roger Perman, Yue Ma, James Mcgilvery and Michael Common (2003). Natural Resource and
Environmental Economics. 3rd ed., Addison-Wesley
 Tom Tietenberg, (2003). Environmental and Natural Resource Economics. 6th ed., Addison Wesley
Jonathan M. Harris and Brian Roach,(2016). Environmental and Natural Resource
Economics notes
1. Sustainable development means
A. Development of underdeveloped countries.
B. Development of underdeveloped resources.
C. Development of water resources.
D. Meeting the needs of the present generation without compromising the needs of the future generation.
2. Which of the following is a renewable resource?
A. Petroleum.
B. Biological species.
C. Mineral ore.
D. Soil fertility.
3. Public goods are those goods for which consumption is
A. Rival.
B. Regulated.
C. Non-rival.
D. Unregulated.
4. Which of the following answers applies to renewable natural resources?
A. Once the renewable natural resource is used, is gone forever.
B. Renewable resources can be replenished.
C. Renewable resources are costly to extract.
D. Renewable resources can be, harvested at any rate without harming future supplies.
5. Determinants of environmental degradation includes all of that except
A. Market failure.
B. Defective economic policies.
C. Defined property rights.
D. Tragedy of commons.
49
6.11 Agricultural Marketing

competence:

Knowledge  Identify the meaning, subject matter, key attributes and relevance of
Agricultural marketing,
 Explain the Marketing problems,
 Explain approaches used to study marketing problems
 Assist in marketing research,
 Illustrate marketing mix and functions,
 Understand marketing efficiency
 Describe market structural-conduct-Performance Analysis,
 Describe the possible wide range of objectives that organizations seek to
achieve through their pricing decisions;
 Analyze and differentiate between cost-oriented and market-oriented
pricing strategies, and select appropriate pricing strategies that help
producers make profit and satisfy customers.
 Evaluate and explain how producer and consumer respond to price
changes;
Skill  Compute marketing costs and margins,
 Estimate demand and supply functions of various agricultural products
Attitude  Use marketing communication and Conduct market research to made
decision of agricultural firms
 Use pricing strategies and marketing orientations for effective market
performance;
 Crawford I.M., 1997. Agricultural and Food Marketing Management, FAO of the United
Nations, Rome
 Kohls, R.L. and Uhl, J.N. (1990) Marketing of Agricultural Products, 6th edition, New York,
Macmillan Publishing Company.
 Kohls, R. L. and Uhl, J. N. 2002. Marketing of Agricultural Products. Ninth Edition. Prentice
Hall, chapters 11.
 Kohls, R.L., and Uhl, J.N. 1990. Marketing Of Agricultural Products, 7th edition, Macmillan
Publishing Company, pp. 196–197.
 Kotler, P and G., Armstrong, 2004. Principles of Marketing, Prentice-Hall, Inc. 10th ed. New
Jersey, USA.
50

1. Agricultural market faces the problem of
A. seasonal price fluctuation
B. low price when crop fails
C. high price when there is bumper crop
D. price stability
2. Demand for agricultural commodities
A. very elastic
B. unit elastic
C. less elastic
D. more elastic
3. Regulated markets aim to protecting
A. Farmers
B. Traders
C. Middlemen
D. Villagers
6.12 International Agricultural Trade

After successful completion of the course, the students are expected to gain the following competence:

Knowledge  Understand and interpret international trade related information;
 Explain why nations trade and the gain of international
trade employing international tradetheories
 Understand the role of multilateral trade negotiations and

the proliferation of regional andbilateral agreements and;
Skill  Evaluate the effects of various trade policy instruments on welfare of
trading partners
 Analyse the effects of international trade on economic growth and
development
Attitude  Make a thorough analysis of modern trade theory, trade policy, and its
welfare implications.
 Salvatore Dominidik, International Economics, 7th ed John Willy & Sons, New York, 2001
 Handbook of International Trade Vol. II (2004). Economic and Legal Analyses of Trade Policyand Institutions Edited
by E. Kwan Choi and James C. Black well Publishing, Oxford, UK
51
1. International trade contributes and increases the world _________

A. Population
B. Inflation
C. Economy
D. Trade Barriers
2. Free international trade maximizes world output through________.
A. Countries reducing various taxes imposed.
B. Countries specializing in production of goods they are best suited for.
C. Perfect competition between countries and other special regions
D. The diluting the international business laws & conditions between countries.
3. Trade between two or more than two countries is known as ________.
A. Internal Business
B. External Trade
C. International Trade
D. Unilateral Trade
4. _____refers to the tax imposed on imports.
A. Imported Tax
B. Tariffs
C. Subsidies
D. Import Quotas
END!
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AGRICULTURAL ECONOMICS NATIONAL EXIT EXAM GUIDEBOOK

DEBRE BERHAN UNIVERSITY

COLLEGE OF AGRICULTURE AND NATURAL

DEPARTMENT OF AGRICULTURAL ECONOMICS

REVISED NATIONAL EXIT EXAM GUIDEBOOK

 To produce skilled and competent manpower to national and international market

2. Rational of the Guidebook

3. Expected Profiles of Graduates

In general, the intended graduate of Agricultural Economics is expected to develop economic

 Design, implement and evaluate agricultural development programs and projects;

 Enhance sustainable agricultural development through effective and efficient mobilization

5. Competencies and Learning Outcomes

5.1 Knowledge that enable them to:

 Participate in design, implementation and evaluation of agricultural development projects;

5.2 Skill that enable them to:

 Use conceptual skill in understanding the complex interrelationship between agriculture

5.3 Attitude that enable them to:

 Perceive the importance of agricultural development for economic growth of a country.

6. Competence Areas, References and Sample Questions

6.1 Microeconomics I & II

Areas of Competency Expected Competencies to be achieved

6.1.2 Reference Materials

 Hal Varian. 2005. Intermediate Microeconomics, A modern Approach 7th Edition

Instruction: Choose the Best Answer among the Given Alternatives

1. Economics is the study of

D. Manufacturers' expectation of lower watch prices in the future.

B. Bertrand duopoly model

6.2 Macroeconomics I & II

Skill  Use different techniques of measuring national income.

Attitude  Listen attentively all macroeconomic lecture sessions

 Respond to questions raised in macroeconomics lecture class

 Mankiw, N. G., 2016. Macroeconomics, 9th ed., Worth Publishing, U.S.A.

6.2.3 Sample Questions

Instruction: Choose the Best Answer among the Given Alternatives

D. Marginal efficiency of capital.

6.3 Research Methods for Agricultural Economics

Areas of Competency Expected Competencies to be achieved

Skill  Be able to formulate and identify research problem identification

6.3.3 Sample Questions

Instruction: Choose the Best Answer among the Given Alternatives

1. In any research process the first task is .

A. Developing a research design

2. The depth and width of the research is determined by .

A. A prerequisite to have an academic degree.

4. The main purpose of _ research is to acquire knowledge.

5. Why do you need to review the existing literature?

A. To make sure you have a long list of references

7. A variable in research that assumes only two values is called

9. Which one is called non-probability sampling?

10. The formal sequence of a research report is represented by .

A. Introduction; Data Collection method ; Data Analysis; Conclusions and

6.4 Development Economics

Areas of Competency Expected Competencies to be achieved

Knowledge  Explain the characteristics of underdevelopment;

6.4.2 Reference Materials

 Todaro, M.P (1997), Economic Development

Instruction: Choose the Best Answer among the Given Alternatives

1. The study of economic development concerns?