Working through the Course
The Course Material
AEC403: Agricultural Production Economics and Resources Management (3
Economics has been defined in a variety of ways and has been a subject of
controversy among eminent economists. One school of thought defined its
scope to cover consumption, production, exchange and distribution of wealth
by men engaged in the ordinary business of life. Production is central to this
school of thought as goods and or services are produced for the consumers
who are at the other end of the production process. The producer uses some
inputs called resources in
an important and intricate proportions to produce
the final commodity.
Thus you will be looking at the subject matter of production economics and
resource management in this course.
This course Guide tells you, in a nutshell, what you should expect from
going through this material. The producer makes on daily basis, decisions
which are economic in nature but may look ordinary to others.
Resources are limited in terms of availability and access. The availability
does not confer accessibility as this is related to price of the resources and
the income of the entrepreneur.
As we look into production theory, we see that, as the individual
entrepreneur tries to satisfy the objective set through the limited resources,
the households’’ utility must be in focus.
Production involves costs which could be either variable or fixed. Producers
always try to produce the maximum possible, incurring the least cost, so as
to make the maximum gain possible. The difference between the cost of
production and the revenue from the sale of output represents the profit of
the producer. The producer always aims at maximizing the profit except in
some exceptional cases.