Which among the following factor s is are considered by the Commission for Agricultural Costs amp Pr...........

Economic Affairs Agricultural Marketing and Prices

Which among the following factor(s) is/are considered by the Commission for Agricultural Costs & Prices (CACP) for calculating cost of production?

Cost of inputs such as seeds, fertilizer, labour
Implied cost of family labour

Select the correct code.

1 only

2 only

Both

None

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Explanation:

The Commission for Agricultural Costs & Prices (CACP) calculates cost of production at three levels: (i) A2, which includes cost of inputs such as seeds, fertilizer, labour; (ii) A2+FL, which includes the implied cost of family labour (FL); and (iii) C2, which includes the implied rent on land and interest on capital assets over and above A2+FL.
CACP reckons only A2+FL cost for return. However, C2 costs are used by CACP primarily as benchmark reference costs (opportunity costs) to see if the MSPs recommended by them at least cover these costs in some of the major producing States.

Hence both statements are correct.