Theory question 110
Basic Agricultural Economics(a) List four factors that cause a change in supply of agricultural produce
(b) Distinguish between fixed cost and variable cost giving two examples in each case
(c) Explain the following agricultural extension teaching methods: (i) posters; (ii) field trips.
Show the model answer
(a) Any four: price of the produce; cost of inputs; weather; technology; government policy (taxes, subsidies); prices of other products; pests and diseases; number of producers; storage and transport facilities
(b) Fixed costs do not change with the level of output (land rent, buildings, machinery depreciation, permanent staff salaries, insurance); variable costs change with output (seeds, fertilizer, feed, casual labour, fuel, chemicals)
(c)(i) Posters: large printed pictures with short messages displayed in public places to draw farmers' attention to a practice or event; cheap but need some literacy
(ii) Field trips: farmers are taken to visit research stations, demonstration plots or successful farms to see improved practices in action; learning by seeing
Two examples each for fixed and variable costs.