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Microeconomics , Fifth Edition
William Boyes, Arizona State University
Michael Melvin, Arizona State University
Internet Exercises
Farms, Fertilizer, and Economic Analysis


The Alberta Agriculture Department (Canada) distributes a software program (AFFIRM) that is designed to assist farmers in determining an optimal level of fertilizer. Read Len Kryzanowski's brief description of the AFFIRM program.

Questions

  1. In this software program, what decision rule is used to determine the optimal level of fertilizer usage? Is this rule consistent with profit maximization?
  2. According to this document, how do other fertilizer recommendation programs work? The author suggests that these other programs overstate the amount of fertilizer that should be used. Why?




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