Course Content
Introduction to farm management – definition, nature, and scope
This lesson will discuss about the definition, nature and scope of farm management.
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Introduction
Different definition of farm management
What makes a successful farm manager?
Farm manager and farm entrepreneur
Characteristics /Nature of farm management
Scope of farm management
Farm management in relation to other science, farm management and farming systems
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Economic Theory
Physical and Biological Sciences
Political Science
Support Sciences
Other social sciences
Farm Management
Production economics and production relationships
Factor-product relationships, factor-factor relationships, product-product relationships
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Production function
Factor-product relationship ( Input-output relationship)
Types of factor- product relationship /Laws of Returns
Three regions of production function
Terminology in production function
Relationship between Total, Average and Marginal products
Elasticity of Production
Factor-Factor Relationship (Input-Input)
Terminology used in Factor-Factor relationship
Characteristics of an isoquant
Characteristics of Isocost line
Types of factor-factor relationship
Least cost combination
Product- Product Relationships
Basic Product Relationships
Different types of product substitution with economic decisions regarding the production of output of each type of production.
Terminologies
Production Transformation Curve (PTC)
Iso-revenue line or Price line
Expansion path in product–product analysis
Determination of Optimum Product Combination
Graphic presentation
Principles involved in farm management decisions
The principle of diminishing return, cost principle, the principle of substitution, the principle of combining enterprise, The principle of equimarginal returns, the principle of comparative advantages, the principle of time comparison
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Introduction
Types of decisions
Principles Involved in Farm Management Decisions
Law of variable proportions or Law of diminishing returns
Cost principle or minimum loss principle
Principle of factor substitution
Law of equi-marginal returns
Opportunity cost
Principle of product substitution
Principle of comparative advantage
Time comparison principle
Limitations of the Principles involved in Farm Management
Farm planning – principles and techniques of farm planning
It includes making decisions regarding the organization and operation of a farm business so that it results in a continuous maximization of net returns of a farm business.
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Introduction
Type of farm plans
Steps in Farm Planning
Farm budgeting
Partial and complete budgeting, steps in farm planning and budgeting
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Introduction
Types of Farm Budgeting
Steps in Farm Planning and Budgeting
Example of Partial Budgeting
Example of Complete Budgeting
Farm records, accounts, and their types
It is essential for a systematic and accurate farm records is helpful for the projection of successful plan and program for betterment.
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Introduction
Reasons for no recorded formal accounting system of data recording
Advantages of Farm Records and Accounts
Problems in Farm Accounting
Usefulness of Farm Records and Accounts
Record Keeping System
Types of Farm Records
Farm inventory
It includes a complete listing of all that a farm owns and owes at a particular date, generally at the beginning and at the end of each agricultural year.
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Introduction
Process of taking farm inventory
Methods of Valuation
Depreciation
Problems in Calculating Depreciation
Measuring financial conditions and farm profits
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Income Statement
Cash flow statement
Balance Sheet
Net worth
Assests
Liabilities
Farm prices and production efficiency
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Introduction
Classification of farm efficiency measures
Measures of farm income and profit efficiency
Factors affecting farm cost and incomes
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Introduction
Factors affecting farm cost and incomes
Introduction to linear programming
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Introduction
Assumptions
Application of Linear Programming
Risk and uncertainty management
This topic describes what risk and uncertainty is.
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Risk
Uncertainty
Types of Risk and Uncertainty
Component (types) of Risk
Methods of reducing risk and uncertainty
Difference between risk and uncertainty
Learn Farm Management with Rahul
About Lesson
  • This economic principle explains one of the basic production relationships viz., factor-factor relationship.
  • It guides in the determination of least cost combination of resources.
  • It helps in making a management decision of how to produce.
  • The principle of factor substitution says that go on adding a resource so long as the cost of resource being added is less than the saving in cost from the resource being replaced.

 

Profit or Decision rules

  1. If Marginal rate of substitution (MRS) is greater than price ratio (PR) costs can be reduced by using more of added resource.

ΔX 2/ ΔX1 > P X1/ P X2 increase the use of X1

  1. If Marginal rate of substitution (MRS ) is less than price ratio (PR), costs can be reduced by using more replaced resource.

Δ X 2/ Δ X1 < P X1/ P X2

  1. Least costs combination of resources is at the point where MRS=PR

ΔX1/ Δ X2 = PX2/ P X1

Or, ΔX2/ Δ X1 = PX1/ P X2

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