Description
Impute supplied machinery-hour opportunity cost from an alternative earning rate.
Farm economic terms require explicit cost scope, subsidy treatment, price-index bases, moisture conventions and period rates. A partial input cost per output differs from total economic cost, while an insurance scenario excludes unsupplied policy limits. A nominal margin is conditional on supplied amounts and assumptions.
Impute supplied machinery-hour opportunity cost from an alternative earning rate.
When to use this tool
Use Farm Machinery Opportunity Hour Cost when you already have alternativeNetEarnings, alternativeHours, machineryHours and need to impute supplied machinery-hour opportunity cost from an alternative earning rate.
How to use the tool and how it works
- Enter alternativeNetEarnings, alternativeHours, machineryHours. Use the units and conventions below.
- Run the tool. Correct any format, range, or cross-field input error before interpreting the output.
- Read opportunityCostPerHour, imputedOpportunityCost. Use the output convention below.
Require alternativeNetEarnings/machineryHours>=0 and alternativeHours>0; rate=earnings/alternative hours and imputed cost=rate*machinery hours.1
| Input field | Meaning and units | Accepted input |
|---|---|---|
| alternativeNetEarnings | Alternative Net Earnings | Required. Finite number; minimum 0. |
| alternativeHours | Alternative Hours | Required. Finite number; strictly above 0. |
| machineryHours | Machinery Hours | Required. Finite number; minimum 0. |
| Output field | Interpretation | Returned shape |
|---|---|---|
| opportunityCostPerHour | Opportunity Cost Per Hour | Required. Finite number. |
| imputedOpportunityCost | Imputed Opportunity Cost | Required. Finite number. |
{
"input": {
"alternativeNetEarnings": 600,
"alternativeHours": 20,
"machineryHours": 5
},
"output": {
"opportunityCostPerHour": 30,
"imputedOpportunityCost": 150
}
}Limitations and assumptions
- The alternative and comparable time basis are supplied. This does not identify a feasible alternative, determine forgone earnings or provide complete economic cost.
- Inputs must satisfy both the field types and the cross-field conditions above. Invalid input causes an error; a successful false flag or documented placeholder is a different result.
- Numeric calculations use binary floating point unless exact decimal-integer arithmetic is explicitly stated. No hidden measurement tolerance or decimal rounding is added; nonfinite or out-of-contract results are rejected. Numeric signed-zero results are exported as zero.
Alternative or Complementary methods
Reconcile actual farm accounts, contracts, policy terms and forecasts. Use complete cost, risk and valuation methods when local per-unit terms or scenarios cannot establish profitability, obligations or appropriate financial decisions.
References
Similar or alternative tools
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