Question

Problem 1 eruliner, and pest control will be A farmer must decide what combination of soed, water, fertilizer, and post con most profitable and environmentally conscious for the coming year. The local lowing table agricultural college did a study of this farmer's situation and prepared the following comel Acre Plan Direct Cost Acre Ex-Market COSACE 5750 800 1000 1300 S1200 1400 1500 1650 The last page of the college's study was tom off, and hence the farmer is not sure which plan the agricultural college recommends. Which plan should the farmer adopt considering: (6) Only the direct costs (b) Both the direct and extra-market costs?

Answer 1

(A) only direct cost is concerned.

plan	income	direct cost	profit= income - direct cost
A	1200	750	450
B	1400	800	600
C	1500	1000	500
D	1650	1300	350
			1900

(B) both cost are concerned.

plan	income	direct cost	extra cost	total cost= direct +extra	profit= income - total cost
A	1200	750	150	900	300
B	1400	800	450	1250	150
C	1500	1000	250	1250	250
D	1650	1300	200	1500	150
					850

farmer should choose plan in which only direct cost is concerned. if he does not want to incur extra cost.