• Economics is the study of how man and society chooses to allocate scarce productive resources to produce various commodities, over time, and distribute them among various consumers in society.
  • It attempts to explain how man can best use the limited resources to produce goods and services which satisfies his needs with minimum wastage or loss of these resources


  • food,
  • clothing
  • shelter
  • Agricultural economics is therefore defined as a science that aims at maximizing output while minimizing costs by combining the limited supplies of goods and services for use by the society over a certain period of time

These are;

  • land,
  • capital,
  • labour
  • management

Basic economic Principles  


  • Economic scarcity means resources are limited in supply relative to demand.
  • This principle implies that there is no time that man can have enough resources to satisfy all his need or desires


  • Human wants are many and varied and means of satisfying them are limited.
  • Therefore, man has to make a choice among the alternatives in order to use the resources available.
  • Man does this by satisfying the most pressing needs first.
  •  This is called scale of preference.

Opportunity Cost

  • Opportunity cost is the revenue forgone from the best alternative.
  •  It exists only where there are alternatives.
  • Where there are no alternatives the opportunity cost is equal to zero.
  • Opportunity cost helps in decision making. 

Farm Records

  • Farm records are documents kept in the farm
  • They show farm activities carried out over a long period of time
  • Or information kept in the farm in written form, about the farm and all activities in it.

Uses of Farm Records

  • Show the history of the farm
  • Show whether the farm is making a profit or loss.
  • Show all the assets and liabilities of the farm which can be used to value the farm.
  • Help in supporting insurance claims on death, theft, fire or loss of farm assets.
  • Help in tax assessment to avoid over taxation.
  • Used as a guide in planning and budgeting.
  • Helps to detect losses or theft in the farm.
  • Make it easy to share profits or losses in partnerships.
  • Help in settling disputes among heirs to estate if the farmer dies without a will.
  • Provide labour information on terminal benefits for a worker.

Type of Farm Records

  • Production Records – Show the total yield and yield per unit of each enterprise.
  • Inventory Records – A record of all permanent and consumable goods in the farm.

Consumable Goods Inventory

  • Field Operation Records – Show in details all field practices carried out together with the input used for all the crop enterprises.
  • Breeding Records

Show all the breeding activities in the farm.

From these records it is possible to select the prolific animals and cull the infertile ones.

  • Feeding Records – A record of the types of feeds used in the farm and their quantities.
  • Health Records
  • Indicates the health conditions of the animals in the farm.
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