G 1-26 A farmer must decide what combination of seed, water, fertilizer, and pest control will be most prof- itable and environmentally conscious for the coming year. The local agricultural college did a study of this farmer's situation and prepared the following table. Plan A B C D Direct Cost/Acre $750 800 1000 1300 Extra-market Cost/Acre $150 450 250 200 Income/Acre $1200 1400 1500 1650 The last page of the college's study was torn off, and hence the farmer is not sure which plan the agricultural college recommends. Which plan should the farmer adopt considering: (a) only the direct costs, (b) both the direct and extra-market costs?

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
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Please show the detail calculation and explanation
G
1-26 A farmer must decide what combination of seed,
water, fertilizer, and pest control will be most prof-
itable and environmentally conscious for the coming
year. The local agricultural college did a study of this
farmer's situation and prepared the following table.
Plan
A
B
C
D
Direct
Cost/Acre
$750
800
1000
1300
Extra-market
Cost/Acre
$150
450
250
200
Income/Acre
$1200
1400
1500
1650
The last page of the college's study was torn
off, and hence the farmer is not sure which plan the
agricultural college recommends. Which plan should
the farmer adopt considering:
(a) only the direct costs,
(b) both the direct and extra-market costs?
Transcribed Image Text:G 1-26 A farmer must decide what combination of seed, water, fertilizer, and pest control will be most prof- itable and environmentally conscious for the coming year. The local agricultural college did a study of this farmer's situation and prepared the following table. Plan A B C D Direct Cost/Acre $750 800 1000 1300 Extra-market Cost/Acre $150 450 250 200 Income/Acre $1200 1400 1500 1650 The last page of the college's study was torn off, and hence the farmer is not sure which plan the agricultural college recommends. Which plan should the farmer adopt considering: (a) only the direct costs, (b) both the direct and extra-market costs?
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