WACE ATAR Agribusiness flashcards
WACE ATAR Agribusiness · Build recall with a focused review session.
32 cards. Read the term and the definition here. The deck at the top of this page is optional.
- Gross margin
- Gross income from an enterprise minus its variable costs. It excludes fixed overheads, so it is used to compare alternative enterprises on a per-hectare or per-unit basis.
- Break-even yield
- The output needed for revenue to equal costs. It equals total variable costs divided by price per unit, holding price constant, and shows the safety margin above expected production.
- Dry sheep equivalent
- A standard feed-demand unit where one DSE equals a 50 kilogram wether at maintenance. It allows stocking rates across different livestock classes to be compared on one scale.
- Feed conversion ratio
- Feed consumed divided by liveweight gain. A lower ratio indicates more efficient conversion of feed into saleable product, which directly affects cost of production per kilogram.
- Dressing percentage
- Carcass weight divided by liveweight, expressed as a percentage. It varies with species, breed, fat score and time off feed before slaughter, affecting saleable kilograms per animal.
- Water activity
- The availability of water for microbial growth in a food. Values below about 0.6 inhibit most microbes, which is why drying and salting preserve products.
- Cold chain
- The continuous temperature-controlled supply sequence from harvest to consumer. Chilled product is held at or below 4 degrees Celsius and frozen product at minus 18 or colder.
- Yield gap
- The difference between potential yield under ideal management and actual yield achieved. It quantifies losses from pests, nutrition, water stress, timeliness and harvest inefficiency.
- Processing margin
- Wholesale product value minus raw input cost minus processing cost. It explains why farm-gate prices and retail prices can move in different directions at the same time.
- Farm business profit
- Gross margin minus overheads, depreciation and finance costs. Depreciation is a non-cash expense but it reduces taxable profit and must be included in true profitability.
- Return on assets
- Operating profit divided by total assets. It measures how productively the whole asset base is used, regardless of how the business is financed.
- Return on equity
- Profit divided by owner equity. It exceeds return on assets when borrowed funds earn more than their interest cost, a process called favourable financial leverage.
- Equity ratio
- Owner equity divided by total assets. A low ratio indicates heavy reliance on debt and greater exposure to interest rate rises and commodity price downturns.
- Price elasticity of demand
- Percentage change in quantity demanded divided by percentage change in price. When demand is inelastic, a price rise increases total revenue for sellers.
- Basis
- Local cash price minus the relevant futures price. It reflects transport, storage and local supply and demand, and is the portion of price a producer cannot hedge.
- Marketing margin
- Retail price minus farm-gate price. A widening margin indicates that more of the consumer dollar is being captured by transport, processing and retail rather than production.
- Soil pH
- A measure of soil acidity measured in calcium chloride solution. Below about 4.8 in the topsoil, legume nodulation and root growth are constrained and liming is required.
- Ground cover
- The proportion of soil surface protected by vegetation or residue. Levels above roughly 70 per cent substantially reduce wind and water erosion risk on agricultural land.
- Water use efficiency
- Saleable product produced per unit of water used, expressed as kilograms per millimetre or dollars per megalitre. It converts a limited resource into a comparable productivity measure.
- Carbon footprint
- Total greenhouse gas emissions divided by output. For livestock, enteric methane and nitrous oxide from fertiliser and urine dominate the calculated footprint.
- Global warming potential
- A factor converting a gas to carbon dioxide equivalents over a set period. Methane is roughly 28 times and nitrous oxide roughly 273 times carbon dioxide over 100 years.
- Nutrient balance
- Nutrients applied minus nutrients removed in harvested product. A persistent surplus signals loss risk to waterways and groundwater and represents wasted input cost.
- Integrated pest management
- A decision framework combining biological, cultural and chemical controls. Chemicals are applied only when pest numbers exceed the economic injury level, preserving natural enemies.
- Salinity risk
- The likelihood of salt rising into the root zone. Risk increases where the watertable is within about two metres of the surface; perennial pastures lower recharge.
- Labour efficiency
- Hectares or livestock units managed per labour unit. It benchmarks whether labour is deployed productively and highlights where mechanisation or contracting may be justified.
- Marginal revenue product
- The additional output value generated by one more unit of labour. A business should hire while this value exceeds the wage plus on-costs such as superannuation.
- Diversification
- Combining enterprises with returns that are not perfectly positively correlated. It reduces whole-farm income variance without necessarily raising average returns.
- Succession planning
- The documented transfer of management control and asset ownership to the next generation. It differs from inheritance because it plans for capability and timing, not only distribution.
- Span of control
- The number of staff reporting to one manager. Wider spans suit routine work, while narrower spans suit complex, hazardous or highly skilled tasks requiring close supervision.
- Capacity utilisation
- Actual output divided by maximum feasible output. Idle capacity raises fixed cost per unit and erodes enterprise margins, so utilisation affects competitiveness.
- Work health and safety cycle
- A continuous process of hazard identification, risk assessment, control implementation and review. It is a legal duty on farm businesses and underpins safe production systems.
- Return on new capital
- Additional annual profit divided by the capital outlay for a new enterprise. It is compared against the opportunity cost of funds before the investment is approved.