The implication of farm credits - SS1 Agriculture Past Questions and Answers - page 1
What is the primary purpose of farm credits?
To increase farmer salaries
To support rural development
To fund luxury purchases
To promote urbanization
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How can lower interest rates on farm credits impact farmers?
Increase their borrowing costs
Improve their profitability
Encourage unsustainable practices
Have no effect on their finances
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What role do fixed-rate loans play in farm credit?
They expose farmers to interest rate fluctuations
They offer stability by locking in a set interest rate
They discourage long-term planning
They are rarely used in agriculture
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How can government intervention affect farm credit markets?
It raises interest rates for farmers
It reduces the availability of credit
It ensures farmers have access to affordable credit
It promotes excessive borrowing
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In what situations can high-interest rates on farm credits impact farm income?
During periods of economic growth
When commodity prices are high
When borrowing costs are low
During economic downturns or low commodity price cycles
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What broader economic factors can influence the interest rates on farm credits?
Crop yields
Global economic conditions
Soil quality
Pest infestations
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How can lower interest rates on loans for sustainable farming practices impact agriculture?
Encourage unsustainable practices
Discourage farmers from adopting sustainability
Incentivize farmers to adopt environmentally friendly methods
Have no impact on farming practices
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What is the potential consequence of high-interest rates on long-term farm loans?
Improved financial stability
Increased debt burdens
Lower profitability
Faster loan repayment
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What is the impact of farm credits on rural development?
They have no effect on rural areas
They can lead to job creation and economic growth
They only benefit urban regions
They promote land consolidation
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How can interest rates on farm credits affect a farmer's ability to plan for the future?
They have no impact on long-term planning
Lower rates make long-term planning easier
Higher rates encourage better planning
Higher rates make long-term planning more challenging
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