Neco 2020 Agricultural Science Question 38

Practice objective / multiple choice question 38 from the 2020 Neco Agricultural Science examination.

Neco 2020 Agricultural Science Objective / Multiple Choice Medium Difficulty
Question 38 NECO • 2020 • AGRICULTURAL_SCIENCE • objective

A farmer cultivates maize on 5 hectares. The variable cost is N30,000 per hectare and the fixed cost per season is N50,000. The expected yield is 4 tonnes per hectare and the current market price is N12,000 per tonne. The farmer is considering buying a new tractor that reduces the variable cost by 15\% but adds a depreciation cost of N20,000 per season. Assuming the yield and market price remain unchanged, will purchasing the tractor increase the farmer's profit? Show your calculations.

Answer Options

A. No, profit decreases by N1,500 (new profit N41,000)
B. Yes, profit increases by N2,500 (new profit N40,000)
Correct Answer C. Yes, profit increases by N2,500 (new profit N42,500)
D. Yes, profit increases by N5,000 (new profit N45,000)
Correct Answer
C
Correct Option:
Yes, profit increases by N2,500 (new profit N42,500)

About This Question

This is Neco 2020 Agricultural Science Question 38. It is one of the objective questions from the 2020 Neco Agricultural Science examination.

Difficulty level: Medium .

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