1. AGR#403

2. INTRODUCTION AGRICULTURE ???? “Cultivation & production of crops and livestock products” “Field-dependent production of food, fodder & industrial organic material” PRODUCTION ???? production is the act of creating 'use' value or 'utility' that can satisfy a want or need. AGR#403

3. ECONOMICS “To how people choose to use productive resources to produce various goods and to distribute these goods to various members of society for their consumption” AGR#403

4. AGRICULTURAL ECONOMICS “ Principles & methods of economics applied to the special conditions of agricultural industry ” AGR#403

5. MEANING SELECTION OF PRODUCTION PATTERNS RESOURCE USE EFFICIENCY OPTIMIZE THE OBJECTIVE FUNCTION OF FARMING COMMUNITY OR NATION AGR#403

6. GOALS TO PROVIDE GUIDANCE TO INDIVIDUAL FARMERS IN USING THEIR RESOURCES MOST EFFICIENTLY. TO FACILITATE THE MOST EFFICIENT USE OF RESOURCES FROM THE STANDPOINT OF ECONOMY. AGR#403

7. DEFINITION “IT IS AN APPLIED FIELD OF SCIENCE WHEREIN THE PRINCIPLES OF CHOICE ARE APPLIED TO THE USE OF CAPITAL, LABOUR, LAND & MANAGEMENT RESOURCES IN THE FARMING INDUSTRY”. AGR#403

8. OBJECTIVES To determine & outline the conditions which gives the optimum use of resources in the production of crops & livestock. To determine the extent to which the existing use of resources deviates from the optimum use. AGR#403

9. CONT… To analyze the forces which condition existing production patterns and resources use. To explain mean and methods in getting from the existing use to optimum use of resources. AGR#403

10. SCOPE OF SUBJECT APPLYING ECONOMIC LOGIC TO PROBLEMS THAT OCCUR IN AGRICULTURE ANY PROBLEM OF FARMERS RELATED TO RESOURCES ALLOCATION. AGR#403

11. CONT… THE AGRICULTURE PRODUCTION ECONOMICS IS CONCERNED WITH ANY PHENOMENA, WHICH HAVE A BEARING ON ECONOMIC EFFICIENCY IN THE USE OF RESOUECES AGR#403

13. BASIC CONCEPTS FARM: Piece of land, where crops & livestock enterprises are taken up under a single management and has specific boundaries AGRICULTURAL HOLDINGS: Total area of land owned by an individual or joint family whether cultivated by the family or rented out. OPERATIONAL HOLDING: Total land area held under a single management for the purpose of cultivation. AGR#403

14. BASIC CONCEPTS OPTIMUM HOLDING: Maximum size of holding which a family should possess. ECONOMIC HOLDING: Land area which could provide a reasonable standard of living to the cultivators. MARGINAL FARMER: Farmer owning less than 2.5 acres of land. AGR#403

15. BASIC CONCEPTS SMALL FARMER: Farmer owning land holding ranging from 2.5 to 5 acres. PRODUCTION: Process whereby some goods & services are transferred into other goods called output. PRODUCT: An outcome of utilization of resources & services of resources. AGR#403

16. BASIC CONCEPTS TECHNICAL COEFFICIENT: The amount of input per unit of output. TECHNICAL UNIT: Convenient unit in production for which output & returns are calculated. PLANT: Group of technical units. RESOURCES: Anything that aids in production. AGR#403

17. BASIC CONCEPTS RESOURCES SERVICES: Work done by a person or a machine or livestock. FIXED REESOURCES: Resources which remain unchanged irrespective of level of production. VARIABLE RESOURCES: Resources which change with the level of production. FLOW RESOURCES: Resources which cannot be stored & should be used as & when they are available. AGR#403

18. Basic concepts STOCK RESOURCES : Stock resources are those which facilitate for their storage, when they are no used in production period. MONO-PERIOD RESOURCE : It is the resource which can be used only once in production. POLY-PERIOD RESOURCE : It is the resource which is used in production process over several periods. PRODUCTION FUNCTION: A systematic and mathematical way of measuring the relationship among different quantities of inputs or input services used in the production of a commodity and corresponding quantities of output is called production function. AGR#403

19. Basic concepts CONTINUOUS PRODUCTION FUNCTION :This production function arise for those inputs which can be divided into smaller doses. Continuous variables can be known from measurement. DISCONTINUOUS OR DISCRETE PRODUCTION FUNCTION : This production function arise for those inputs or work units, which are used in whole number. AGR#403

20. Basic concepts EFFICIENCY : It means absence of wastage or using resources as effectively as possible to satisfy the farmer’s needs and goal. AGR#403

21. Basic concepts TECHNICAL EFFICIENCY : It is the ratio of output to input. ECONOMIC EFFICIENCY : It is the expression of technical efficiency in monetary value by attaching prices. AGR#403

22. Basic concepts COST OF PRODUCTION : The expenditure incurred in producing a unit quantity of output is called cost of production. VARIABLE : Any quantity which can have different values in the production process. INDENDENT VARIABLE: It is a variable whose value does not depend on other variable. DEPENDENT VARIABLE : A variable that is governed by another variable. AGR#403

23. Basic concepts CONSTANT : A quantity that does not change its value in a general relation between variables. COEFFICIENT: when rate per unit is calculated, we use the term coefficient, a multiplying factor. SLOPE : Slope of a line represents the rate of change in one variable that occurs when another variable change. AGR#403

24. FEATURES OF AGRICULTURAL PRODUCTION VS COMPARED TO INDUSTRIAL PRODUCTION FARMING A WAY OF LIFE DEPENDENCE ON WEATHER SEASONALITY OF PRODUCTION PREISHABLE NATURE OF AGRICULTURAL PRODUCTS JOINT PRODUCTS BULKINESS OF AGRICULTURAL PRODUCTS PROBLEMS OF STANDARDIZATION TIME LAG IN PRODUCTION OF AGRICULTURAL PRODUCTS. AGR#403

25. CONT…. LARGE PROPORTION OF LAND LAW OF DIMINISHING RETURNS NATURE OF DEMAND EFFICIENCY OF CAPITAL PRODUCER’s SHARE IN CONSUMERL’s RUPEE AGR#403

26. Basic concepts SHORT RUN PRODUCTION FUNCTION: The planning period during which one or more resource are fixed. LONG RUN PRODUCTION FUNCTION: It is a planning period during which all resources are varied in quantity. ALLOCATIVE EFFICIENCY :It occurs when no possible reorganization of production can make any one better off without making some one else worse it. AGR#403