Final Exam Review

# Final Exam Review - AAE 320 Final Exam Review Paul D...

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Unformatted text preview: AAE 320 Final Exam Review Paul D. Mitchell Spring 2008 Goal Explain what to expect for final exam Overview new topics since last exam Idea of how to study Study Aids Overheads, think breaks Course Readings (Phil Harris material) Problem Sets Exams taken this year Old Exams Expect this year's final to be harder than last year's final New Topics Covered Since Exam 2 Enterprise Budgeting Partial Budgeting Time Value of Money Farm Programs Enterprise Budgeting Purposes for enterprise budgets Weaknesses of enterprise budgets Cost concepts Machinery costs Fixed vs variable costs or overhead vs operating costs (same thing) Opportunity costs Economic Engineering vs. Custom Rates How to adjust custom rates for quick estimate (Think Break 17) Partial Budgeting Know how to take verbal description and do a partial budget analysis Examples of partial budgeting Answer the 4 questions and make table Know Weaknesses/Limits of Partial Budgets Overheads: Custom vs. own planter Overheads: Custom vs. own combine (think break 18) Overheads: Convert grain to forage and add beef cows Problem Set #6 2006 and 2007 Final Exam Time Value of Money Know basic equation and how to use it in its different forms Discounting to present value FV = PV x (1 + r)t Lots of different questions can be answered Several Think Breaks plus Problem Set 6 Intuition of discounting Discount Rate vs. Discount Factor Time Value of Money Net Present Value for income streams Why do we need it? How calculate it and interpret it Annuity: I'll give you the annuity equation K = (1/r){{1 [1/(1 + r)t]} Annuity C = NPV/K How interpret it? Weed Resistance Management Case Study Know basic idea of the tradeoffs farmers face Farm Programs Commodity Price Support Programs Main changes discussed for new Farm Bill Know basic idea of how they work Direct Payments, Counter Cyclical Payments and Loan Deficiency Payments Terms to know: Base Acres, Program Yield, Target Price, Loan Rate, National Marketing Year Average Price, Posted County Price Replace price support with revenue support Farm Programs Crop Insurance Programs Subsidies: Premiums and Administration Yield vs. Revenue Insurance Coverage Individual vs. Areawide Coverage Policies: APH, CRC, GRP, GRIP CRC most popular policy for corn and soybeans AGRLite: Schedule F Income Implication of these subsidies for farmers Exam Study Expect questions on the material from the first 2 exams: Comprehensive Exam New Material the Primary Focus Focus on Key Concepts Big picture, not details Things to remember 5 years from now See slides above Key Concepts to Know: Exam 1 Optimality conditions How much input to use Output Price = Marginal Cost Able to apply in table and calculus formats Calculus How much output to produce Value of Marginal Product = Input Price Nothing more than single input production Key Concepts to Know: Exam 1 Average Cost, Marginal Cost, Total Cost Opportunity Cost and Economic Profit Calculations in table formats and relationships What is it, how to interpret Be able to apply these concepts in context of problems, as well as short answer See 1st Exam this year, plus exams from previous years Key Concepts to Know: Exam 2 Depreciation Methods Financial Analysis Straight Line, Declining Balance, IRS Method Use Balance Sheet and Income Statement to calculate and interpret ratios, returns, rates of return, profit margin Look over last year's exams and this year's 2nd Exam, plus problem sets Taxes, Business Arrangements, Transfers ...
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## This note was uploaded on 08/08/2008 for the course AAE 320 taught by Professor Mitchell during the Spring '08 term at University of Wisconsin.

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