The use and effectiveness of financial and physical reserves in Montana's dryland wheat area by Howard W Hjort A THESIS Submitted, to the Graduate Faculty in partial fulfillment of the requirements for the degree of Master of Science in Agricultural Economics Montana State University © Copyright by Howard W Hjort (1959) Abstract: The research problem was to test whether financial and physical reserves could be used by the dryland farmer to better adapt his farm organization and operations to the highly variable conditions encountered in dryland grain framing. When and if they could be so used, the problem was to determine the effectiveness of these reserves. Reserves were defined as that part of the assets and/or earnings of a farm unit purposefully retained and managed in cash or in a less liquid form, as a provision for meeting current and future demands of the firm and household. To test whether reserves could be used by the farmer, yield series of 14 to 24 years were constructed for 67 tracts of state-owned cropland located in the Judith Basin and Sheridan and Roosevelt counties. An analysis of these yield series determined the liquid reserves that would be required to cover the non-deferrable expenses of the firm and household in both the short run and over time. These requirements ranged from $472 to $35,550 in the northeast area, from $0 to $41,061 in the other area. The average requirements in these respective areas were $6,301 and $7,060 when the four series witty, either extremely low average yields or high yield variability were excluded. To determine the effectiveness of reserves, the amount of income above yearly non-deferrable expenses was isolated for three farm units in each study area. The farm unit in each area representing the low yield group was unable to accumulate the surplus net cash income necessary for long' run survival. ' For the remaining four farm units the surplus income was used to replace depreciable items and invested to accumulate capital. The surplus that was invested demonstrated the effectiveness of reserves of a somewhat less liquid form.  THE USE AND EFFECTIVENESS OF FINANCIAL AND PHYSICAL RESERVES IN MONTANA'S DRYLAND WHEAT AREA by HOWARD W. HJORT Approved : A THESIS Subm itted , t o th e .G raduate F a c u l ty i n p a r t i a l f u l f i l lm e n t o f the" r e q u ir em e n ts f o r th e d e g re e , o f M aste r o f S c ie n c e i n A g r i c u l t u r a l Econom ics a t M ontana S t a t e C o lle g e /. I' /ad, M ajor D epa rtm en t C ha jrm an5 E xam in ing Comm ittee D ean5 G rad u a te D iv i s io n Bozeman-, M ontana - A ugu s t5 1959 TABLE QF CONTENTSC-Af- ^ Page LIST OF ILLUSTRATIONS . . . LIST OF TABLES . . . . . . ACKNOWLEDGMENTS ......................... ABSTRAC T - , . . . . . o - o . . . o o i l l i v v i v i i CHAPTER I . INTRODUCTION........................ .............................................................. A. The P rob lem S i t u a t i o n ............................................................................. 1 . The A g r i c u l t u r a l I n d u s t r y ................................................ .... . . 2 . D ry lan d A g r ic u l tu r e i n th e G re a t P l a in s R eg ion . . . 3 o The R e se a rc h P r o b l e m ............................................................... .... 4 . The I n d iv id u a l F arm er and H is G o a l s ............................. .... . Oo lh e P r e s e n t S i t u a t i o n ................................................................... . i o B. O b je c t iv e s . . . . . . . . . . . . .... .......................................... . 10 C. H ypo th eses ..................................................................................................... . n D. P ro c ed u re and A ssum ptions . ..................................................... 11 1 . S tu dy A r e a ............................. .... ..............................................................12 2 . The S p e c i f i c Farm U n i t .............................................................. . 12 3 . The P la n o f th e F o llow in g C h a p t e r s ........................ 15 CHAPTER I I . YIELD VARIABILITY .................................................................................. 17 A. I n t r o d u c t i o n .................................. .... .................................................... 17 B. S ou rce o f Y ie ld D a ta ..................................................................................18 C. C o n s t ru c t io n o f Y ie ld S e r i e s ........................................... . 19 D. M easu res o f Y ie ld V a r i a b i l i t y ............................. . . . . . . 26 E. Y e a r - to - y e a r Y ie ld V a r i a b i l i t y o f th e Group D e s c r i b e d ....................................... ......................................................... .... . 27 F . Y e a r - to - y e a r Y ie ld V a r i a b i l i t y a s E x p e r ie n c ed by th e I n d iv id u a l . . . . . . . . . . . . . . . ......................... . . 29 CHAPTER I I I . SHORT RUN SURVIVAL . . . . . . . . . . . . . . . . . . . . . _____ . A. Farm U n it E xp en se s . . . . . . . ..................................................... B. Farm U n it Income .................................................................................. .... . C. Farm U n it Income and Expense ............................. .... ............................ D. R e se rv e s R e q u ire d f o r S u r v iv a l i n th e S h o r t Run . . . . 31 31 34 36 37 CHAPTER IV . SURVIVAL AND CAPITAL ACCUMULATION ............................................ 42 A. S h o r t Run S u r v iv a l . . . . . . . ..................................................... 42 B. S h o r t Run S u r v iv a l s i n Time S e r i e s .............................................44 I . S u r v iv a l i n th e Long R u n ................... .... ............................ .... . 50 C. C a p i t a l A ccum u la tion ........................ 0 . . . . . . . . . . . 57 CHAPTER V. SUMMARY AND CONCLUSIONS . ............................. ......................................61 A. S u m m a ry ......................................................... &1 B. C o n c l u s i o n s ........................ .... .............................................................. .... . 63 C. Im p l ic a t i o n s . . . . . . . o . . . . . . . . . . . . . . 63 D. F u tu re R e se a rc h . . . . . . . . . . . . . . ......................... 65 138405 <0 < 2 •t' - H H H TABLE QF CONTENTS (C on tin u ed ) E sge APPEND ICES........................................................................ 67 A ppendix A .................................................................................................................... 68 Appendix B .................................................................................................................... 79 Appendix C .................................................................................................................... 89 BIBLIOGRAPHY......................................................................................................................... 104 i i LIST CF ILLUSTRATIONS F ig tf fe s Page ' 1 Tw enty-year. Y ie ld S e r i e s on S ta te -ow n ed C rop land L o ca te d i n J u d i t h B a s in County {R -12, T-17 , S -34 ) , M ontana •................................................ 5 2 Y ie ld s P e r S eeded Acre a s R ep o r te d f o r 63 S ta te -ow n ed •T rac ts o f C ro p lan d L o ca ted i n J u d i t h B a s in ' and F e rg u s C o u n t ie s , M dn taha , 1945' . .........................7 3 C o u n tie s in . M ontana S e l e c t e d a s R e p r e s e n ta t iv e o f D ry ­ la n d W in te r and S p r in g Wheat P ro d u c t io n . . . . . . . . . 13 4 L o c a t io n o f S e l e c t e d S ta te -ow n ed T r a c t s o f C ro p lan d in ' S h e r id a n and R o o s e v e l t C o u n t ie s , M ontana . . . . . . . 23 5 L o c a t io n o f S e l e c t e d S ta te -ow n ed T r a c t s o f C rop land i n J u d i t h B a s in and F e rg u s C o u n t ie s , M ontana , , . . . . 24 6 Y ie ld V a r i a t i o n by Y ear's , S ta te -ow n e d C ro p lan d , S p r in g and W in te r Wheat A rea s 28 7 Y ie ld V a r i a b i l i t y on 67 S ta te -ow n e d T r a c ts o f C ro p lan d , S p r in g and W in te r Wheat A re a s , M ontana . . . . . . . . . 29 8 Y e a r - to - y e a r Net W orth f o r th e T h ree S e le c te d Y ie ld S e r i e s i n t h e ' S p r in g Wheat A r e a ....................' .................................. 55 , N , . . . . . . . . . . . \ 9 Y e a r - to - y e a r N et W orth f o r th e Three S e le c te d Y ie ld S e r i e s i n th e W in te r Wheat A rea . ..................................................... 56 i i i . i . LIST CF TABLES Number I I I I I I IV V VI V II V I I I IX X XI NUMBER OF YIELD SERIES FOR STATE-OWNED CROPLAND IN SELECTED COUNTIES IN THE WINTER AND SPRING WHEAT AREA, BY NUMBER CF YEARS IN SERIES 0 0 0 . \ . AVERAGE YIELD PER SEEDED ACRE FOR 30 STATE-OWNED TRACTS OF CROPLAND, BY NUMBER CF YEARS IN EACH SERIES, SHERIDAN AND ROOSEVELT COUNTIES . „ . . , AVERAGE YIELD PER SEEDED ACRE FOR 37 STATE-OWNED TRACTS OF' CROPLAND, BY NUMBER CF YEARS IN EACH SERIES, JUDITH BASIN; AND FERGUS COUNTIES ' 0 ' „ . \ . .■ . o . / TOTAL AND PER SEEDED ACRE FARM UNIT BY' AREAS . . Q .■ ■. ..." :■' . -- ■ • FIXED CASH EXPENSE OF THE DIFFERENT YIELD COMBINATIONS AND THE DOLLAR RESERVE REQUIREMENT' FOR SURVIVAL OVER TWO AND THREE-YEAR TIME PERIODS, 'SPRING'WHEAT'AREA . . . V . . "0 0' 0 v . 0 DIFFERENT YIELD COMBINATIONS AND THE DOLLAR RESERVE REQUIREMENT FOR SURVIVAL OVER TWO AND THREE-YEAR TIME PERIODS, WINTER WHEAT AREA . , . / . . - . MAXIMUM RESERVES IN DOLLARS REQUIRED AT ANY ONE TIME FOR SURVIVAL UNDER SHORT RUN CONDITIONS FOR EACH YIELD SERIES IN THE' SPRING WHEAT AREA" MAXIMUM RESERVES IN DOLLARS REQUIRED AT ANY ONE TIME FOR SURVIVAL UNDER SHORT RUN CONDITIONS FOR EACH YIELD SERIES 'IN THE WINTER WHEAT AREA . . CUMULATIVE YEARLY SURPLUS AVAILABLE FOR LONG RUN SUR­ VIVAL AND CAPITAL ACCUMULATION WHEN RESERVES' ARE MANAGED AS CASH 'IN W . B A H ,' GRAIN 'STORED AND REPLACED RAPIDLY, AND' GRAIN'STORED AND REPLACED ONLY IN HIGH YIELD YEARS," FOR THE’ /THREE' SELECTED YIELD SERIES IN EACH OF THE TWO STUDY AREAS ' ........... ' °. °. .. CUMULATIVE DEPRECIATION CHARGE TO MAINTAIN COMPLETE INVENTORY AND TO DEPRECIATE OUT EQUIPMENT AT END OF per iod f Or Three selected ' y ield s e r ie s in each study DOLLAR VALUE OF THE SURPLUS FOR INVESTMENT AT THE END OF THE TIME "PERIOD WHEN INVESTED AT VARIOUS RATES OF INTEREST FOR TWO SELECTED YIELD SERIES LN EACH STUDY 25 26 31 40 41 47 47 52 53 59 I v LIST .QF TABLES (C o n tin u ed ) Number X II YEABLI SUBPLUS, YEABLI SUBPLUS FOB INVESTMENT, AND THE CUMULATIVE VAJ1UE OF THIS SUBPLUS WHEN INVESTED AT A 6 PEECENT bate of in teb e st , Yie ld s e b ie s ' s ix eeVebsEd , WINTEB WHEAT ABEA V V • . • • I * v Page .• 60 v ACKNOfLEDGMENTS F o r p r o v id i n g . th e o p p o r tu n i ty t o engage i n t h i s p a r t i c u l a r r e s e a r c h e f f o r t , th e a u th o r i s ■in d e b te d to th e Farm Econom ics R e se a rc h D iv i s io n o f th e A g r i c u l t u r a l R e se a rc h S e r v io h , U n i te d S t a t e s D ep a r tm en t o f A g r i c u l t u r e . ' F o r th e p e r s o n a l and p r o f e s s i o n a l encou ragem en t r e c e iv e d th ro u g h ­ o u t th e p e r io d o f t im e t h i s s tu d y h a s b e e n I n p r o g r e s s , s i n c e r e ap p re ­ c i a t i o n i s e x te n d e d t o D r . D . C. M p rick , A g r i c u l t u r a l E co n om is t, Farm Econom ics. R e se a rc h D iv i s i o n , A g r i c u l t u r a l R e se a rc h S e r v i c e , U n ite d S t a t e s D ep a r tm en t o f A g r i c u l t u r e , Thanks a re due a l s o to t h e members o f th e t h e s i s and exam in ing c om m itte e s : D r . Jo hn F i s c h e r , c h a irm an ; P r o f e s s o r s C a r l K ra e n z e l , C la re n c e J e n se b ,' M au rice T ay lo r,, and H elm er' H o l je , m embers. F i n a l l y , a p p r e c i a t i o n i s e x te n d e d t o th e p r o f e s s i o n a l e c o n om is ts o f th e Farm Econom ics R e se a rc h D iv i s io n who have c o n t r i b u t e d t o th e m a t e r i a l t h a t was u s e d i n th e s tu d y , and t o th e s e c r e t a r i a l s t a f f who e x h ib i t e d ex trem e p a t i e n c e i n p u t t i n g t h e m a t e r i a l i n f i n a l ' fo rm . The r e s p o n s i b i l i t y f o r e r r o r s i s my own. v i ABSTRACT The r e s e a r c h p rob lem was t o t e s t w h e th e r f i n a n c i a l and p h y s ic a l r e s e r v e s c o u ld be u s e d by th e d ry la n d fa rm e r to b e t t e r a d a p t h i s fa rm o r g a n iz a t io n and o p e r a t io n s to th e h ig h ly v a r i a b l e c o n d i t io n s e n c o u n te re d i n d ry la n d g r a i n f ram in g . When and i f th e y c o u ld be so u s e d , th e p rob lem was to d e te rm in e th e e f f e c t i v e n e s s o f t h e s e r e s e r v e s . R e se rv e s w ere d e f in e d a s t h a t p a r t o f th e a s s e t s a n d /o r e a rn in g s o f a f a rm ,u n i t p u r p o s e f u l ly r e t a i n e d and managed i n c a sh o r i n a l e s s l i q u i d fo rm , a s a p r o v i s i o n f o r m ee tin g c u r r e n t and f u t u r e demands o f th e f i rm and h o u seh o ld . To t e s t w h e th e r r e s e r v e s c o u ld be u s e d by th e f a rm e r , y i e l d s e r i e s o f 14 t o 2/ y e a r s w ere c o n s t r u c te d f o r 67 t r a c t s o f s ta te -o w n e d c ro p ­ la n d l o c a t e d i n th e J u d i t h B a s in and S h e r id a n and R o o s e v e lt c o u n t i e s . An a n a ly s i s o f t h e s e y i e l d s e r i e s d e te rm in e d th e l i q u i d r e s e r v e s t h a t w ould be r e q u i r e d t o c o v e r th e n t in - d e f e r r a b le ex p en se s , o f : .th e , f i rm and h o u seh o ld i n b o th th e s h o r t r u n and o v e r t im e . These r e q u i r em e n ts r a n g e d from $472 t o $ 3 5 ,5 5 0 i n th e n o r t h e a s t a r e a , from $0 t o $41 ,0 61 i n th e o th e r a r e a . The a v e ra g e r e q u i r em e n ts i n th e s e r e s p e c t i v e a r e a s w ere $ 6 ,301 and $ 7 ,0 6 0 when th e f o u r s e r i e s witty, e i t h e r e x trem e ly low av e rag e y i e l d s o r h ig h y i e l d v a r i a b i l i t y were e x c lu d e d . To d e te rm in e th e e f f e c t i v e n e s s o f r e s e r v e s , th e amount o f income above y e a r l y n o n - d e f e r r a b le ex p en se s was i s o l a t e d f o r t h r e e fa rm u n i t s i n e a ch s tu d y a r e a . The fa rm u n i t i n e a ch a r e a r e p r e s e n t in g th e low y i e l d g roup was u n a b le t o a c cum u la te th e s u r p lu s n e t c a sh inooine n e c e s ­ s a ry f o r lo n g ru n s u r v i v a l . F o r th e r em a in in g f o u r fa rm u n i t s th e s u r p lu s income was u s e d t o r e p l a c e d e p r e c ia b le i tem s and in v e s t e d to a c cum u la te c a p i t a l . The s u r p lu s t h a t was i n v e s t e d d em o n s tra te d th e e f f e c t i v e n e s s o f r e s e r v e s o f a somewhat l e s s l i q t i i d fo rm . ■ ' , v i i CHAPTEB I INTBQDUOTXON The P rob lem S i t u a t i o n V a r i a t i o n s i n p r o d u c t io n c a u se d by th e w e a th e r , i n s e c t s , and d i s e a s e s , t o g e th e r w i th ex trem e p r i c e f l u c t u a t i o n s , i n t r o d u c e e lem en ts o f r i s k s and u n c e r t a i n t i e s i n t o th e b u s in e s s o f a g r i c u l t u r e „ Heady sp eak s o f r i s k and u n c e r t a i n t y i n th e f o l lo w in g m anners B isk r e f e r s to v a r i a b i l i t y o r ou tcom es w h ich a r e m ea su rab le i n an e m p i r ic a l o r q u a n t i t a t i v e m anner. U n c e r ta in ty r e f e r s to f u t u r e e v e n ts Where th e p a ram e te r s o f th e p r o b a b i l i t y d i s t r i ­ b u t io n c a n n o t be d e te rm in e d e m p i r i c a l l y . A n t i c i p a t i o n s o f th e f u t u r e c a n be fo rm ed b u t t h e r e i s no way t h a t th e e n te r p r e n e u r o r a d m in i s t r a t o r c a n a ssem b le enough homogeneous o b s e rv a t io n s ' to p r e d i c t th e r e l e v a n t p r o b a b i l i t y d i s t r i b u t i o n . B is k i s in s u r a b le i n an a c tu a r i a l " s e n s e ; u n c e r t a i n t y i s n o t . i / T h e r e f o r e , a c t i o n may be ta k e n by th e i n d iv i d u a l to s h i f t r i s k w h ile he m ust l i v e w i th u n c e r t a i n t y . The A e r ic u l th r a ] . I n d u s t r y There a re two p r i n c i p a l v a r i a b l e s t h a t c a u se r i s k and u n c e r t a i n t y i n th e a g r i c u l t u r a l i n d u s t r y . They a re p r i c e and o u tp u t . The, i n d iv i d u a l t h a t depends upon th e open m ark e t f o r th e s a le o f h i s p ro d u ce i s f o r c e d to l i v e w i th th e p r i c e u n c e r t a i n t i e s t h a t a re c h a r a c t e r i s t i c o f t h a t i n d u s t r y . When p r i c e i s f r e e to f l u c t u a t e , th e u n c e r t a i n t y a s s o c i a t e d w i th t h i s v a r i a b l e i s common t o a l l p ro d u c e rs o p e r a t in g w i t h in th e i n d u s t r y , r e g a r d l e s s o f g eo g rap h ic l o c a t i o n . When I / E a r l 0 . Heady, E conom ies o f A g r i c u l t u r a l P ro d u c tio n and B esou rce U se - P r e n t i o e -H a l l , I h c . , Englewood C l i f f s ' , New J e r s e y , 1.952, p p . 440 , 443„ — 2 — p r i c e i s f i x e d f o r some s p e c i f i c t im e p e r io d p r i c e u n c e r t a i n t y i s n o n - e x i s t e n t d u r in g t h a t p e riod ,, o f t im e . P r i c e a s a v a r i a b l e may be c o n s id e r e d a s b e in g i n t e r n a l t o 'th e in d u s - t r y b u t e x t e r n a l to th e f i rm . The i n d iv i d u a l h a s no c o n t r o l o v e r p r i c e v a r i a b i l i t y b u t a t th e i n d u s t r y l e v e l a c t i o n c an and h a s b een ta k e n to c o n t r o l p r i c e s . L e g i s l a t i v e p r i c e s u p p o r t s a re exam p les o f t h i s fo rm o f s t a b i l i z i n g a c t i o n . When l e g i s l a t i v e a c t i o n d e te rm in e s th e p ro d u c t p r i c e no p r i c e r i s k o r u n c e r t a i n t y i s p r e s e n t f o r th e i n d iv i d u a l o r th e in d u s ­ t r y , a t l e a s t i n th e s h o r t r u n . A b a s ic a ssum p tio n i n t h i s s tu d y i s t h a t p r i c e i s a c o n s t a n t , • th e r e b y e l im in a t i n g one o f th e two v a r i a b l e s from f u r t h e r c o n s id e r a t io n . I n d i c a t i o n s a re t h a t l e g i s l a t i v e a c t i o n w i l l c o n t in u e t o c o n t r o l o r s u p p o r t th e p rice" o f fo o d and f e e d g r a i n s . I t i s t r u e t h a t th e p r i c e l e v e l may v a ry o v e r t im e ev en w i th , o r a s th e r e s u l t o f , l e g i s l a t i v e a c tio n ,. However, r e g a r d l e s s o f th e l e v e l , th e minimum b a s e p r i c e w i l l b e d e te rm in e d e a ch y e a r p r i o r t o th e tim e t h a t management m ust d e te rm in e th e s h o r t run . u s e o f r e s o u r c e s and p r i c e u n c e r t a i n t y i s c o n f in e d to r e l a t i v e l y n a rrow l im i t s . Even when p r i c e s a re n o t f i x e d o r s u p p o r te d , p r i c e u n c e r t a i n t y i s common to a l l p r o d u c t io n a r e a s , so t h e h ig h r i s k and u n c e r t a i n t y p e c u l i a r to th e G rea t P l a i n s i s a t t r i b u t a b l e t o u n c e r t a i n ty i n o u tp u t . T h e r e f o r e , o u tp u t rem a in s a s th e b a s ic p rob lem i n t h i s s tu d y . The am ounts o f l a n d and l a b o r a v a i l a b l e t o th e f i rm w i l l be d e te rm in e d p r i o r t o a n a ly s i s — th e y w i l l become f i x e d r e s o u r c e s . The o th e r two - 3 - r e s o u r c e s , managemeirfc and c a p i t a l , w i l l b e v a r i a n t s — management w i l l v a ry w i th r e s p e c t t o c a p i t a l and incom e. The o p e r a to r w i l l manage h i s f i x e d r e s o u r c e s t o u t i l i z e c a p i t a l i n a m anner c o n s i s t e n t w i th h i s g o a ls — th o s e t h a t a re p o s tu l a t e d a s r e a l i s t i c g o a ls o f i n d iv i d u a l farm ers= O ther i n p u t s o r f a c t o r s t h a t d e te rm in e o u tp u t c an be c l a s s i f i e d , r , „ • - a s b e in g i n t e r n a l o r e x t e r n a l t o th e f i rm . No c la im t o i n c lu s iv e n e s s i s made and some i n p u t s w i l l be b o th i n t e r n a l and e x t e r n a l . I n t e r n a l i n p u t s c a n be d i r e c t l y c o n t r o l l e d by m anagement. Examples o f i n t e r n a l i n p u t s ’ a r e : ( l ) g r a i n t r e a t i n g m a t e r i a l s , ( 2) weed c o n t r o l m a te r ia ls , - (3 ) f e r t i l i z e r s , (4 ) c ro p and b u i ld i n g in s u r a n c e , and ( 5) c r e d i t . E x te r n a l i n p u t s c a n n o t be d i r e c t l y c o n t r o l l e d by m anagement.' Exam ples a r e ; (1 ) w in d , ( 2 ) tem p e ra tu r e , (3 ) m o is tu r e , ( 4 ) h a i l , (5 ) f r e e z e , ( 6 ) f lo o d , (v). i n s e c t s , and ( 8) p l a n t d i s e a s e s . E x te r n a l i n p u t s a re th e m a jo r c a u s e s o f th e r i s k s and u n c e r t a i n t i e s a s s o c i a t e d w i th o u tp u t . I n t e r n a l i n p u t s c a n be u t i l i z e d t o re d u c e th e e f f e c t s o f e x t e r n a l i n p u t s by m anagement. Management o f c a p i t a l and income becomes a p ro b lem o f m anaging th e i n t e r n a l i n p u t s , i n an a ttem p t to r e d u c e ;th e a d v e rs e e f f e c t s o f t h e e x t e r n a l i n p u t s . T h is i s a p rob lem o f -the- i n d iv i d u a l and th e i n d u s t r y t h a t r e q u i r e s a d d i t i o n a l r e s e a r c h . P r i v a t e and p u b l ic i n s t i t u t i o n s have b een c r e a te d to m in im ize th e e f f e c t s o f e x t e r n a l i n p u t s . Crop in s u r a n c e c an be u se d by management to s h i f t r i s k . H a i l in s u r a n c e c an be p u rc h a s e d f o r any c o v e ra g e l e v e l m anagement d e s i r e s . A l l - r i s k c ro p in s u r a n c e p ro v id e s c o v e ra g e o f th e - U - Gash ex p en se a s s o c i a t e d w i th c ro p p r o d u c t io n . N e v e r th e le s s , t o s h i f t t h e s e r i s k s o r t o assume them becomes a management d e c i s i o n . D ry lan d A g r i c u l tu r e i n th e Gfreat P l a i n s B eg ion The G re a t P l a i n s H eg ion h a s b een r e c o g n iz e d as an a r e a where v a r i a t i o n s i n p r o d u c t io n a re h ig h ly e r r a t i c . 2/ V a r ia b le p r o d u c t io n p ro ­ d u c e s ex trem e v a r i a t i o n i n th e i n d iv i d u a l f a rm e r 's incom e. I n th e d ry la n d a g r i c u l t u r a l a r e a s o f th e P l a i n s th e e x t e r n a l f a c t o r s c a u se p rob lem s o f g r e a t e r c o n c e rn th a n a re fo und i n o th e r m a jo r d ry la n d a g r i c u l t u r a l a r e a s . I n f a c t , v a r i a b i l i t y o h a ra c te r iz f e s d r y la n d a g r i c u l t u r e i n th e P l a in s R eg ion . C onsequen t ex trem e v a r i a t i o n s i n th e f o r tu n e o f th e i n d iv i d u a l f a rm e r i s a t y p i c a l e x p e c t a t i o n 1 t h e " P l a i n s •a g r i c u l t u r a l i s t = The r e p u t a t i o n o f th e r e g io n a r i s e s n o t from ex trem e v a r i a t i o n from y e a r - t o - y e a r a lo n e b u t b e c a u s e v a r i a t i o n o c c u rs i n an u n p r e d ic ta b l e m anner. The i n d iv i d u a l i s c o n c e rn ed w i th y e a r - t o - y e a r v a r i a t i o n i n y i e l d and w i th y i e l d d i f f e r e n c e s f o r th e same y e a r . 2./ Those c o n c e rn e d w ith t h e s e v a r i a t i o n s in c lu d e a s a s u b - c l a s s o f y e a r - to , - y e a r v a r i a t i o n y e a r s 2 / E . g . , see w orks o f C a r l F . K ra e n z e l , R u ra l ,S o c io lo g i s t , M ontana S t a te C o l le g e ; R a in e r S c h io k e le , A g r i c u l t u r a l E conom is t, f o rm e r ly a t N o rth D ako ta A g r i c u l t u r a l C o lle g e ; E . L loyd B a rb e r , A g r i c u l t u r a l E conom is t, f o rm e r ly o f th e B u reau o f A g r i c u l t u r a l E conom ics, USDA; P h i l T h a ir1, ' A g r i c u l t u r a l Dponomis t , fo rm e r ly o f th e B ureau o f A g r i c u l t u r a l E conom ics , USDA/ s t a t i o n e d a t th e N o r th D ak o ta A g r i c u l t u r a l C o lle g e ; and E a irl 0. Heady, A g r i c u l t u r a l E conom is t a t Iowa S t a t e C o l lb g e . Y ie ld s w i l l v a ry from y e a r to y e a r f o r th e fa rm a s a w h o le , b u t a ls o ■' y i e l d d i f f e r s from one p a r t o f th e fa rm t o th e n e x t i n th e same y e a r . - 5 - o f low , m ean, o r h ig h y i e l d s t h a t te n d t o g ro u p .V There a re i n d i c a t i o n s o f t h i s i n s e r i e s o f y i e l d s s p e c i f i c t o i n d iv i d u a l t r a c t s o f la n d such a s t h a t shown i n F ig u re I . I n t h i s y i e l d s e r i e s , th e mean y i e l d i s 1 4 .5 b u s h e ls p e r se ed ed a c r e ; th e s ta n d a rd d e v ia t i o n i s a p p ro x im a te ly 6 .44 b u s h e l s . The c o e f f i c i e n t o f v a r i a t i o n i s 4 4 .4 p e r c e n t . T h is t r a c t o f la n d i s l o c a t e d i n J u d i t h B a s in c o u n ty and i s owned by th e S t a t e o f M ontana, Mean Y ie ld 1 4 .5 Y ear F ig u re I . Tw en ty -y ea r Y ie ld S e r i e s on S ta te -ow n ed C ro p lan d L oca ted i n J u d i t h B a s in County (R -12 , T -17 , S -34 ) M ontana. i d The s t a t i s t i c a l t o o l s u sed to d e te rm in e b u n c h in e s s do n o t c o n firm t h a t - . t h i s i s s o . T h is may be b e c au se (1 ) th e l a c k o f a s u i t a b l e s t a t i s t i c a l d e v ic e , (2 ) th e l a c k o f a d eq u a te tim e s e r i e s d a ta , o r (3 ) b u n c h in e s s d o e s n o t e x i s t w h ich i s c o n t r a r y to w hat we see i n v i s u a l i n s p e c t io n o f e x i s t i n g tim e s e r i e s . - 6 - F ig u r e '2 p r e s e n t s y i e l d s a s r e p o r t e d i n 1945 by o p e r a to r s o f 63 ■ v. ' : ■ ■ ' d i f f e r e n t t r a c t s o f s ta te -o w n e d c ro p la n d i n J u d i t h B a s in and F e rg u s c o u n t i e s o I t i s e v id e n t t h a t w i th in any ones y e a r p ronounced d i f f e r e n c e s i n y i e l d s a re th e r u l e r a t h e r th a n th e e x c e p t io n i n t h i s d r y la n d c ro p a r e a . F o r th e 63 y i e l d o b s e r v a t io n s , th e mean y i e l d i s 15 .2 b u s h e ls p e r se ed ed a c r e , th e s ta n d a r d d e v ia t io n 8 .2 8 b u sh e ls ? t h e r e f o r e , th e c o e f f i c i e n t o f v a r i a t i o n i s 5 4 .5 p e r c e n t . The y i e l d s on a s e ed ed a c re ■ b a s i s r a n g e from 0 t o 3 6 .6 b u s h e ls . E x trem e v a r i a t i o n i n y i e l d o f e i t ty d r o f t h e s e ty p e s c a u se th e e x t e r n a l f a c t o r s t o be c l a s s e d a s u n c e r t a i n t i e s r a t h e r th a n r i s k s , a s i t becomes im p o s s ib le f o r th e i n d i v i d u a l fa rm e r to p a s s them on t o someone e l s e . Numerous econom ic s t u d i e s have b een made i n v a r io u s p a r t s o f th e G re a t P l a i n s to e x p lo r e t h e s e r i s k and u n c e r t a i n t y a s p e c t s o f d ry la n d a g r i c u l t u r e . j> / I n d i c a t i o n s a re t h a t i n t e l l i g e n t u se o f r e s e r v e s w i l l p rom o te income s t a b i l i t y f o r th e i n d iv i d u a l and th e i n d u s t r y . I t seems t h a t c a p i t a l and incom e a re r e c o g n iz e d a s f a c t o r s t h a t c a n be managed th ro u g h th e u s e o f r e s e r v e s . T h is r e c o g n i t i o n g iv e s r i s e t o th e s p e c i f i c r e s e a r c h p rob lem to be s tu d i e d . j> / E s p e c i a l l y by S e h i c k e l e , B a r b e r , . T h a i r , and B a ld u r K r i s t j an son , A g r i c u l t u r a l E co n om is ts fo rm e r ly o f th e N o rth D ak o ta A g r i c u l t u r a l C o l le g e . ' - rJ - Y ie ld O b s e rv a t io n s and Townships o f O b se rv a t io n s F ig u re 2 . Y ie ld s P e r Seeded Acre a s R e p o r te d f o r 63 S ta te -ow n ed T ra c ts o f C ro p lan d L o ca ted i n J u d i t h B a s in and F e rg u s C o u n t ie s , M ontana, The R e se a rc h P rob lem The p rob lem o f t h i s r e s e a r c h e f f o r t i s to t e s t w h e th e r f i n a n c i a l and p h y s ic a l r e s e r v e s c an be u sed by th e d ry la n d fa rm e r i n th e G rea t P l a i n s R eg ion , and i f s o , to m easu re how e f f e c t i v e t h e y , t o g e th e r w ith o th e r management t e c h n iq u e s , a r e i n r e d u c in g th e a d v e rs e e f f e c t s o f th e e x t e r n a l f a c t o r s . - 8 - R e se rv e s wi l l be d e fin ed , a s t h a t p a r t o f th e a s s e t s a n d /o r e a rn in g s o f a fa rm p u r p o s e f u l ly r e t a i n e d and managed i n c a sh o r i n a l e s s l i q u i d fo rm , a s a p r o v i s io n f o r m ee tin g th e c u r r e n t atid f u t u r e demands o f th e f i rm and th e h o u se h o ld . As su ch , r e s e r v e s w i l l be o f two m a jo r c a t e r g o r ie s s ( l ) f i n a n c i a l and (2 ) p h y s i c a l . R e s e rv e s w i l l be lo o k ed upoh a s fo rm s o f c a p i t a l . The q u a n t i t y o f r e s e r v e s w i l l f l u c t u a t e i n u s e and w i l l be c o n t r o l l e d by a n n u a l v a r i a t i o n s i n th e income s tr e am and th e way i t i s m anaged a s i t e n t e r s th e b u s in e s s . I t i s r e c o g n iz e d t h a t some fa rm e r s may have ajmple c a p i t a l beyond t h a t i n v e s t e d i n th e fa rm u n i t t h a t , i f r e t a i n e d i n s u f f i c i e n t l y l i q u i d fo rm , th e y c o u ld o p e ra te w i th o u t o th e r r e s e r v e s . 6 / However, r e t u r n s from s u c h - c a p i t a l comm itted sem i-p e rm an en tly may be g r e a t enough t o draw i t ' o f f snd j u s t i f y u se o f a r e s e r v e p rog ram a p p r o p r ia t e t o a s i t u a t i o n w i th o u t s u r p lu s q a p i t a l . F i n a n c i a l r e s e r v e s in c lu d e s (1 ) c a s h bank a c c o u n ts , (2 ) l i f e i n s u r ­ ance a n n u i t i e s , (3 ) f e d e r a l , m u n ic ip a l , and c o rp o r a te b o n d s , (4 ) common s to c k s , and (5 ) o th e r fo rm s o f s e c u r i t i e s . Exam ples o f p h y s ic a l r e s e r v e s a r e : ( l ;) fo o d o r f e e d g r a i n s to r e d , (2) m aph in e ry and eq u ipm en t, (3) fa rm l a n d , and (4 ) o f f - f a rm r e a l p r o p e r t y . £>/ The fa rm u n i t c o n s i s t s o f th e p ro d u c in g and cdpsum ing p o r t i o n s o f th e fa rm , and i s t h e r e f o r e c o n s id e r e d a Comple^e econom ic u n i t . T h is te rm w i l l be u s e d th ro u g h o u t t h i s r e p o r t and i n c o r p o r a t e s th e f i rm and’ th e h o u se h o ld . \" 9 - J h e I n d iv id u a l F arm er and Hi a GnaTiq The f a rm e r 's p la n n in g and a c t i o n a r e gov e rn ed by th e s e t o f r e s o u r c e s a t h i s command, by known te c h n iq u e s , by h i s know ledge and a p p r a i s a l o f w e a th e r and o th e r h a z a rd s , and p r i c e e x p e c t a t i o n s , H is d e c i s i o n s a re made w i th in th e e s t a b l i s h e d s e t o f i n s t i t u t i o n s , b o th pub l i e and p r i v a t e , w i th w h ich he does b u s in e s s and c a r r i e s on many o f th e a c t i v i t i e s o f h i s d a i l y l i v i n g . The i n s t i t u t i o n a l fram ew ork and i n d i v i d u a l i n s t i t u t i o n s may o r may n o t be a d a p te d t o th e e n v iro nm en t o f th e G re a t P l a i n s , I n f a c t , th e y may be i n c o n f l i c t w i th th e g o a ls o f th e fa rm u n i t , A com p rehen siv e econom ic a n a ly s i s o f r e s e r v e u se r e q u i r e s t r a n s c e n d in g i n s t i t u t i o n a l ' b o u n d a r ie s i n an a t tem p t t o l o c a t e and d e f in e th e c o n d i t io n s n e c e s s a ry t o h e lp th e fa rm u n i t a c h ie v e i t s g o a ls . I t i s assumed t h a t th e g o a ls o f th e fa rm u n i t a re s u r v i v a l ov e r t im e and c a p i t a l a c c um u la t io n o v e r t im e . The h o u seh o ld m ust s u rv iv e ; t h i s i s a p r e r e q u i s i t e t o th e f i r m 's s u r v i v a l . The management p rob lem i s t o o rg a n iz e and manage th e h o u seh o ld and f i rm , and t o c o n d u c t th e b u s in e s s a f f a i r s i n a m anner t h a t w i l l a t t a i n th e s e g o a ls . The e x te n t t o w h ich th e s e g o a ls a re r e a l i z e d i s a m easu re o f econom ic s u c c e s s . As th e fa rm u n i t a t t e m p ts to e s t a b l i s h i t s e l f a s a b u s in e s s ," th e f i r s t g o a l i s s u r v i v a l . A t Some f u r t h e r s ta g e o f d eve lopm en t th e m ajo r g o a l becomes c a p i t a l a c c um u la t io n . The g o a ls change when th e m anager d e c id e s t h a t s u r v i v a l i s a s s u r e d . The c h a n g in g o f g o a ls i s e x p e c te d to 10 - i n f l u e n c e th e way r e s e r v e s a re u sed and a lm o s t by d e f i n i t i o n th e q u a n t i t y and fo rm s o f r e s e r v e s t h a t a re a v a i l a b l e „ The optimum u se o f r e s e r v e s by any fa rm u n i t may r e q u i r e f i n a n c i a l r e s e r v e s a lo n e , p h y s i c a l r e s e r v e s a lo n e , o r some c om b in a tio n o f b o th . Optimum u se o f r e s e r v e s w i l l o c c u r when th e fa rm u n i t u s e s th e r e s e r v e s a v a i l a b l e i n th e m anner m ost c o n s i s t e n t w i th th e l im i t e d r e s o u r c e s u n d e r i t s command and by t h i s u s e th e y w i l l b e c o n s i s t e n t w i th th e o b j e c t iv e s o r g o a l s , t iie fo rm o f t e n u r e , th e f i x e d r e s o u r c e s o f la n d and l a b o r , and th e i n s t i t u t i o n a l fram ew ork w i th in w h ich th e m anager makes h i s d e c i s i o n s w i l l have an e f f e c t on th e optimum u se o f r e s o u r c e s . T h is optimum w i l l be g u id ed by th e g o a ls a s p r e v io u s ly p o s tu l a t e d . The P r e s e n t S i t u a t i o n • • -V ' ■ ■■ P r e s e n t know ledge o f th e u se and e f f e c t s o f r e s e r v e s , a s d e f in e d , i s h o t a d eq u a te t o r e j e c t o r s u b s t a n t i a t e e x i s t i n g b e l i e f s o f f a rm e r s , r e s e a r c h e r s , and o th e r i n d iv i d u a l s c o n c e rn e d , An econom ic a n a ly s is - , d f t h i s p rob lem w i l l r e s u l t i n in fo rm a t io n o f v a lu e to th e i n d iv i d u a l f a rm e r , th e E x te n s io n S e r v ic e , A g r i c u l tu r e E xpe rim en t S t a t i o n s , D e p a r t­ m ent and o th e r F e d e r a l O f f i c i a l s and o th e r s c o n c e rn ed w i th N o r th e rn G rea t P l a i n s a g r i c u l t u r e .and r u r a l w e l f a r e . O b je c t iv e s TTie m a jo r o b j e c t iv e i s to d ev e lo p econom ic in fo rm a t io n co n ce rn in g - r e s e r v e s and t h e i r u s e t h a t w i l l h e lp th e fa rm o p e r a to r i n M ontana and i n s im i l a r a r e a s , t o b e t t e r a d ap t h i s fa rm o r g a n iz a t io n and o p e r a t io n s t o th e h ig h ly v a r i a b l e c o n d i t io n s e n c o u n te re d i n d ry la n d g r a i n fa rm in g . 11 S p e c i f i c o b j e c t iv e s a re t o : 1 . M easure th e e f f e c t o f r e s e r v e s on. d ry la n d fa rm o r g a n iz a t io n , m anagem ent, and o v e r a l l econom ic s u c c e s s . 2 . D em on s tra te th e e f f e c t i v e n e s s o f o r g a n i z a t i o n a l and manage­ ment a d ju s tm e n ts th e fa rm u n i t c an make by u s in g r e s e r v e s . H ypo th e se s W ith in th e U n c e r ta in income s i t u a t i o n s c h a r a c t e r i s t i c o f fa rm in g i n t h e N o r th e rn G rea t P l a i n s R eg ion , th e fa rm u n i t can u se f i n a n c i a l and p h y s i c a l r e s e r v e s t o a l l e v i a t e th e p ro b lem s o f m anagement, c a p i t a l , and incom e i n th e e f f o r t s to a t t a i n th e o b j e c t i v e s . S p e c i f i c h y p o th e s e s a re s 1 . Thp i n d iv i d u a l who i n t e l l i g e n t l y m anages r e s e r v e s w i l l a t t a i n econom ic s u c c e s s b e fo r e th e i n d iv i d u a l who d o e s n o t u t i l i z e r e s e r v e s . 2 . F o r e a ch o r g a n i z a t i o n a l and. o p e r a t io n a l fa rm b u s in e s s t h e r e w i l l be a r e s e r v e u se p a t t e r n t h a t i s optimum. Of th e d i f f e r e n t o r g a n i z a t i o n a l and o p e r a t i o n a l p la n s a v a i l a b l e t o th e , i n d iv i d u a l one w i l l show an a b s o lu te ad v an tag e o v e r th e o th e r s . P ro c ed u re and A ssum p tion s T h is r e s e a r c h i s a p h a se o f a m a jo r r e s e a r c h p r o j e c t c u r r e n t l y b e in g c o n d u c te d by th e Farm Econom ics R e se a rc h D iv i s io n . 2 / The b a s ic d a ta a c cum u la te d f o r th e m a jo r p r o j e c t w i l l p ro v id e much o f th e b a s ic in fo rm a ­ t i o n n eed ed . 2 / Stjudy i n p r o g r e s s , E f f e c t s o f W eather on Economy o f D ry la n d F arm s, c o n d u c te d b y Don E„ 'B o s tw ick , A g r i c u l t u r a l ' Economi s t , Farm Econom ics R e se a rc h D iv i s i o n , A g r i c u l t u r a l R e se a rch S e r v i c e , U n ited S t a t e s D ep a r tm en t o f. A g r i c u l t u r e . . 12 - S tudy A rea The g e o g ra p h ic s tu d y a r e a i s , i n g e n e r a l , th e d ry la n d w in te r and s p r in g w hea t a r e a s o f T fcn tanaf s p o r t i o n o f th e G rea t P l a i n s . I t i s ' hoped t h a t th e r e s u l t s o f t h i s s tu d y w i l l be a p p l i c a b le t o s im i l a r d ry ­ la n d a r e a s o f th e N o r th e rn G re a t P l a i n s . S p e c i f i c a l l y , p o r t i o n s o f F e rg u s , J u d i t h B a s in , S h e r id a n , and RooiS e v e l t c o u n t i e s wiere s e l e c t e d f o r s tu d y . The u n d e r ly in g a ssum p tio n .4 i n t h i s s e l e c t i o n i s t h a t t h e s e c o u n t i e s a r e r e p r e s e n t a t i v e o f th e two m a jo r w hea t p ro d u c in g a r e a s i n M ontana. The f i r s t two r e p r e s e n t th e w in t e r w hea t a r e a , th e l a t t e r two th e s p r in g w hea t a r e a . These s tu d y a r e a s a re shown on th e f o l lo w in g map p r e s e n te d a s F ig u re 3 . The S p e c i f i c Farm Un i t I t i s a n e c e s s a ry r e q u ir em e n t t h a t th e fa rm u n i t be o f ad eq u a te s i z e ■ t o r e t u r n , a t a l e v e l o f management commonly p r a c t i c e d i n th e a r e a , incom e s u f f i c i e n t t o m eet i t s g o a ls . T here m ust be s u f f i c i e n t income d y e r t im e t o p ro v id e a l e v e l o f l i v i n g th e f am i ly w i l l a c c e p t , c o v e r c a s h e x p e n se s , and m eet o v e rh e ad c o s t s —— th e s e a re c h a r a c t e r i s t i c s o f a fa rm u n i t t h a t w i l l s u r v iv e . A lso ' o v e r t im e , th e r e m ust b e some s u r p lu s f o r r e in v e s tm e n t , f o r c a p i t a l a c c um u la t io n a s th e se co nd g o a l i s e x p re s s e d abov e . I n th e s h o r t r u n , c a p i t a l , m ust be a d e q u a te to m eet minimum and n o n -d e f e r r a b le , l i v i n g c o s t s and c a s h o p e r a t in g c o s t s . I f t h e s e c o s t s a re n o t c o v e re d , r e s e r v e s c a n n o t be u t i l i z e d e f f e c t i v e l y . i f a t a l l . MONTANA Sherida F e rgu s Jud ith B as in F ig u re 3 . C o u n tie s in Montana S e l e l e c t e d as R e p r e s e n ta t iv e o f D ry land W in te r and S p rin g Wheat P ro d u c t io n . - 14 - Y ie ld s e r i e s o v e r t im e w i l l be c o n s t r u c te d from s t a t e l e a s e d a ta t h a t r e c o r d s y i e l d e x p e r ie n c e s p e c i f i c t o t r a c t s o f c ro p la n d w i th in th e s e l e c t e d f o u r c o u n t i e s . These y i e l d s e r i e s w i l l d e s c r ib e y i e l d v a r i a ­ b i l i t y and d i f f e r e n c e s o B udg e ts w i l l b e c o n s t r u c te d t h a t compare th e fa rm u n i t s incom e a s i t v a r i e s due t o v a r i a t i o n i n 'y i e l d . A lso , d i f ­ f e r e n t o p p o r t u n i t i e s w i th r e s p e c t t o th e management o f t h i s fa rm income w i l l be b u d g e te d . These b u d g e ts w i l l b e b a s e d on th e f o l lo w in g a ssum p tio n s? th e fa rm u n i t w i l l c o n s i s t o f a f am i ly o f f o u r p e o p le t h a t r e n t s 1,700 a c r e s o f fa rm la n d ; th e f am i ly owns th e m ach in e ry , eq u ipm en t, and th e b u i ld in g s n e c e s s a r y f o r an o p e r a t io n o f t h i s s i z e ; f am i ly l a b o r i s a d e q u a te f o r a l l .m ajo r fa rm o p e r a t io n s e x c e p t p l a n t i n g and" h a r v e s t in g ; h i r e d la b o r u s e d d u r in g p l a n t i n g w i l l be t r e a t e d a s a f i x e d c o s t w h i le th e amount o f h i r e d l a b o r u t i l i z e d d u r in g h a r v e s t in g o p e r a t io n s i s c o n s id e r e d a f u n c t i o n o f th e a c re a g e h a rv e s te d . C o s t d a t a a re a v a i l a b l e from a p r o j e c t b e in g c o n d u c te d by th e Farm Econom ics R e se a rc h D iv i s i o n . 8/ These d a t a a re b a sed on 1958 p r i c e s . A l l c o s t s a s s o c i a te d w i th th e p r o d u c t io n from t h i s fa rm u n i t w i l l be ■ tre a te d a s c o n s t a n t s w i th th e e x c e p t io n o f th e h i r e d l a b o r m en tio n ed above and d i r e c t h a r v e s t i n g and g r a in s to r a g e c o s t s . S / 8/ S tu d y i n p r o g r e s s . S upp ly R esponse o f Wheat on D ry lan d Grot) Farms in M ontana, c o n d u c te d by LeRoy C. Rude, A g r i c u l t u r a l E co n om is t, Farm Econom ics R e se a rc h D iv i s i o n , A g r i c u l t u r a l R e se a rch S e r v ic e , U n ited S t a t e s D ep a rtm en t o f A g r i c u l t u r e . 2 / D i r e c t ih g rv e s t in g ' e a s t s e ih c lu d e .!oper a t ih g t do sdas o f th e com bine , t h e ; - o p e r a t i n g o s t „o f th e v e h i c l e s u se d t o h a u l th e g r a i n , and th e grain h a n d l i n g .c o s t s . - 15 - Of. th e 1 ,7 0 0 a c r e s r e n t e d , 1 ,6 40 a r e t i l l a b l e ' . ' These 1 ,640 a c r e s a re u s e d f o r summerfa llo w and c ro p , 820 a c r e s o f e ach e v e ry y e a r . The fa rm u n i t i s o p e ra te d u n d e r r e g u l a t i o n s im posed by th e c u r r e n t farm p ro g ram , and a s su c h , h a s a w hea t b a s e o f 820 a c r e s . T h is i s re d u c ed 30 p e r c e n t f o r com p lian ce w i th th e a c re a g e a l lo tm e n t p rog ram . The on ly s a l e a b l e c ro p s p ro d u ced f o r income a re w hea t and b a r l e y , and b o th a re , c o n s id e r e d c a s h c r o p s . E ach y e a r t h e r e a re 574 a c r e s se ed ed t o wheat, and 246 se ed ed a c r e s o f b a r l e y . 1 0 / The la n d o w n e r 's s h a re o f th e c ro p i s o n e f o u r t h i n th e - sp r in g w heat a r e a , one t h i r d i n th e w in t e r w heat a r e a . The p ro d u c t p r i c e s a re b a sed on p r o j e c t i o n s by th e A g r i c u l t u r a l R e se a rc h S e rv ic e and th e A g r i c u l t u r a l M a rk e tin g S e r v ic e . 11/ As p r e v io u s ly i n d i c a t e d , t h e s e p r ic e s ' w i l l be t r e a t e d a s c o n s t a n t s . The P la n o f th e F o llow in g C h ap te rs The c om p le tio n o f t h i s s tu d y r e q u i r e s f o u r s ta g e s o f d eve lopm en t. Y ie ld v a r i a b i l i t y w i l l be d e s c r ib e d i n C h a p te r I I by an a n a ly s i s o f s t a t e l e a s e r e c o r d s ' t h a t i d e n t i f y and r e c o r d y i e l d e x p e r ie n c e o v e r t im e . The v a r i a t i o n i n th e y i e l d s e r i e s c o n s t r u c te d from th e s e d a t a w i l l p r o v id e means f o r t e s t i n g and c l a s s i f y i n g r e s e r v e s . The amount o f 1 0 / The w hea t b a s e (820 a c r e s ) t im e s 70 p e r c e n t e q u a ls t h e w hea t a c re a g e .. The. w hea t b a s e l e s s th e w hea t a c re a g e e q u a ls t h e b a r l e y a c re a g e . H / U n i te d S t a t e s D ep a r tm en t o f A g r i c u l t u r e , A g r i c u l t u r a l P r i c e and C ost P r o j e c t i o n s . W ash ing ton , D. C . , Sep t embe r , 1957 , p p . 10 and 14 . - 1,6 - r e s e r v e s , i n d o l l a r t e rm s , n e c e s s a ry f o r s h o r t - r u n s u r v iy a l w i l l be c a l c u l a t e d f o r e a ch y i e l d s e r i e s i n th e two a r e a s . I n C h ap te r I I I a l l p o s s ib l e y i e l d c om b in a tio n s be low s h o r t - r u n s u r v i v a l w i l l be c o n v e r te d t o d o l l a r te rm s and t e s t e d f o r o n e , tw o , and t h r e e - y e a r t im e p e r i o d s . T h is w i l l p ro v id e in fo rm a t io n t h a t w i l l be - u s e f u l i n d e te rm in in g th e d o l l a r amounts o f r e s e r v e s n eed ed f o r s h o r t - r u n s u r v i v a l . C h ap te r 17 w i l l be c o n c e rn ed w i th r e s e r v e s r e q u i r e d f o r s u r v iv a l o v e r t im e , th e p r im a ry g o a l , and a ls o w i th r e s e r v e s a v a i l a b l e t o th e fa rm u n i t f o r c a p i t a l a c c um u la t io n , th e s e co n d a ry g o a l . H e se rv e r e q u i r e ­ m en ts o v e r t im e w i l l b e d e te rm in e d . Any s u r p lu s income w i l l be in v e s te d f o r th e p u rp o se o f c a p i t a l a c cum u la tio n and v a r io u s in v e s tm e n ts w i l l be com pared . The f i n a l c h a p t e r . C h ap te r V, w i l l be c o n c e rn ed w i th th e summary and c o n c lu s io n s o f th e s tu d y . CHAPTEE I I ' TIEID YAEIABIL IIT , I n t r o d u c t i o n I t i s a n e c e s s a ry c o n d i t io n f o r r e s e a r c h c o n c e rn in g r e s e r v e s t h a t y i e l d v a r i a b i l i t y b e d e s c r ib e d a s c lo s e t o r e a l i t y a s p o s s ib l e . I t i s n e c e s s a ry b e c au se no two f i rm s a re i d e n t i c a l i n te rm s o f o u tp u t$ t h e r e f o r e , th e amounts o f c a p i t a l a v a i l a b l e o v e r tim e o r on a y e a r - to ,- y e a r b a s i s w i l l be d i f f e r e n t f o r e a ch fa rm u n i t , As y e a r l y income T _ ' v a r i e s th e amount a v a i l a b l e f o r r e s e r v e u s e v a r i e s — th e y c an be c o n s id e r e d th e same c o n c e p t from o p p o s in g v iew p o in ts . A ls o , d e c i s io n s c o n c e rn in g th e u se o f r e s e r v e s a re m a n a g e r ia l d e c i s io n s s p e c i f i c to o n ly one fa rm u n i t . To d e s c r ib e y i e l d v a r i a b i l i t y a d e q u a te ly , y i e l d d a t a m ust be s p e c i f i c t o one t r a c t o f la n d ( o r fa rm ) o v e r t im e . T h is r e q u i r e s d a ta t h a t c an b e so i d e n t i f i e d . T h is i s i n c o n t r a s t to d a t a t h a t r e p r e s e n t th e a v e ra g e o f g ro u p s o f f a rm s , such a s an e n t i r e c o u n ty . The a v e rag e o f t h e g roup i s l e s s v a r i a b l e and h en c e , d o e s n o t a d e q u a te ly r e p r e s e n t th e p ro b lem o f th e i n d i v i d u a l . A ttem p ts have b een made, a t v a r i o u s t im e s , t o l o c a t e i n d iv i d u a l fa rm o p e r a to r s t h n t m a in ta in y i e l d r e c o r d s ove r t im e . These a t tem p ts haye b een q u i t e u n s u c c e s s f u l . . The a l t e r n a t i v e w as to s e l e c t y i e l d s e r i e s s p e c i f i c t o one t r a c t o f la n d t o r e p r e s e n t y i e l d e x p e r ie n c e f o r th e fa rm u n i t . T h is m ethod was u s e d ev en though i t t e n d s t o o v e r em phasize y i e l d v a r i a b i l i t y f o r th e fa rm u n i t , S ou rce o f Y ie ld D a ta The S t a t e o f M ontana h o ld s t i t l e t o t r a c t s o f la n d l o c a t e d th ro u g h ­ o u t th e s t a t e . These l a n d s a re l e a s e d t o , and o p e ra te d b y , l o p a l fa rm i p e o p le . C u r r e n t ly , c ro p la n d i s l e a s e d on a c ro p - s h a r e - b a s i s . The l e a s e s a re f o r t e n - y e a r t im e p e r i o d s , and a t th e e x p i r a t i o n d a te com pet- t i v e c r o p - s h a r e b id s a re r e c e iv e d . The h ig h e s t b id d e r i s e n t i t l e d to th e la n d f o r th e n e x t t e n - y e a r p e r io d ; however,, t h e current lessee has t h e r i g h t t o m eet th e h ig h e s t b i d , and i f he does s o , c o n t in u e s to l e a s e th e l a n d . The s t a t e m a in ta in s r e c o r d s t h a t i d e n t i f y th e s e t r a c t s o f la n d by ' o p e r a to r , le a s e "n um b e r , arid l e g a l d e s c r i p t i o n . These r e c o r d s l i s t th e number o f c ro p a c r e s r e p r e s e n te d by th e l e a s e and th e c r o p - s h a r e a g re e ­ m ent f o r th e p e r io d o f t im e th e l e a s e i s h e ld . Each y e a r t ^ e number o f se ed ed c ro p a c r e s , by c r o p s , a re r e p o r t e d and r e c o rd e d a s i s th e b u s h e l s h a re o f t h e s e c ro p s t h a t th e s t a t e r e c e iv e s . W ith t h i s i n f d r , m a t io n , th e b u s h e l y i e l d p e r se ed ed a c re c a n be c a l c u l a t e d . Exam ples Assume; ( l ) s t a t e s h a re o f w hea t r e c e iv e d i s 210 b u s h e ls ; ( 2) th e c r o p - s h a r e ag reem en t i s 1 /4 — 3 /4 ; (3 ) 120 a c r e s a re se ed ed to w hea t;" " I n t h i s ex am p le , th e y i e l d p e r seed ed a c re f o r th e t r a c t o f la n d i s 7 .0 b u s h e ls Z—C.21.0 )— \ .A 120 / P r i o r t o 1927 i t w as m anda to ry t h a t a c a s h payment b e made f o r th e u s e o f t h e s e s t a t e l a n d s . From 1927 u n t i l t h e l a t e 1930 ' s . t h e c ro p - s h a re r e n t a l sy s tem was p e rm is s a b le . I n th e 1938 s e s s i o n , th e s t a t e l e g i s l a t u r e p a s s e d a Igw t h a t made th e c r o p - s h a r e sy s tem m and a to ry . — 18 — — 19 — As th e l e a s e s e x p ir e d a f t e r t h i s y e a r , th e r e n ew a ls w ere on a c ro p - s h a r e b a s i s . Lands t h a t w ere r e n t e d u n d e r th e c a sh payment ag reem en t d id n o t r e q u i r e r e c o r d in g o f any c ro p d a ta ; t h e r e f o r e , . i t i s . im p o s s ib l e . t o d e te rm in e th e y i e l d p e r a c re on la n d s so o p e r a te d . As y i e l d d a t a were a v a i l a b l e o n ly th ro u g h th e 1956 c ro p y e a r , m ost o f th e y i e l d s e r i e s a re f o r a 1 7 -o r - 1 8 - y e a r t im e p e r io d . T h is i s u n f o r tu n a te f o r t h i s p rob lem , a s th e 1 9 3 0 's a re known a s a p e r io d o f v e ry a d v e rs e c o n d i t io n s f o r fa rm p e o p le i n t h e s e a r e a s . C o n s t ru c t io n o f Y ie ld S e r i e s The y i e l d s p e r se ed ed a c r e , from in f o rm a t io n r e p o r t e d by th e I q ^ s e e , w ere c a l c u l a t e d f o r e a ch t r a c t o f c ro p la n d owned by th e s t a t e i n t h e s e f o u r c o u n t i e s . T h is had b een done f o r th e m a jo r p r o j e c t , th u s t h e in f o rm a t io n was r e a d i l y a v a i l a b l e . As p r e v io u s ly i n d i c a t e d , th e s e t r a c t s o f l a n d w ere i d e n t i f i a b l e by l e a s e num ber, o p e r a to r , and l e g a l d e s c r i p t i o n . However, when a l e a s e i s ren ew ed , c u r r e n t l y e v e ry IQ y e a r s - - p r e v io u s ly e v e ry f i v e y e a r s , th e number ch ang es and i n many c a s e s th e o p e r a to r a l s o c h an g e s . Thus, th e o n ly means o f i d e n t i f i c a t i o n o y e r t im e i s by l e g a l d e s c r i p t i o n . The p rob lem was t o i s o l a t e y i e l d d a t a o v e r tim e s p e c i f i c t o a t r a c t o f la n d and f o r t h i s s tu d y th e sm a l le s t t r a c t c o n s id e r e d was a s e c t io n , 640 a c r e s . A t t im e s , two o r even t h r e e l e a s e s w ere fo und f o r d i f f e r e n t p a r t s o f th e same s e c t i o n o f l a n d . I n su ch c a s e s , th e w e ig h te d av e rag e Was u se d t o d e te rm in e th e y i e l d p e r se ed ed a c re r e p r e s e n t a t i v e o f th e s e c t i o n . - 20 - The i d e n t i f i c a t i o n o f y i e l d s s p e c i f i c to one s e c t i o n r e q u i r e d s o r t ­ in g th e d a ta c a r d s t h r e e t im e s , by r a n g e , b y ,to w n sh ip w ith in ." e 'ach r a n g e , and by s e c t i o n w i th in e a ch ra n g e - to w n sh ip c om b in a tio n . ,A f te r e a ch s o r t , d a t a c a rd s t h a t d id n o t c o v e r an a d eq u a te tim e p e r io d c o u ld be e l im in a te d from f u r t h e r c o n s id e r a t i o n . A f t e r s o r t i n g , th e l e g a l d e s c r i p t i o n , th e number o f a c r e s o f c ro p ­ l a n d , th e y e a r o f d a t a , th e seed ed a c r e s o f w h ea t, and th e w hea t y i e l d p e r s e ed ed a c re w ere t a b u l a t e d . I t was assumed t h a t y i e l d s e r i e s w i th l e s s th a n 12 y e a r s o f d a t a w ould be i n s u f f i c i e n t to d e s c r ib e y i e l d v a r i a ­ b i l i t y o v e r t im e . Thus, f u r t h e r e l im in a t i o n o f d a ta by v i s u a l in s p e c ­ t i o n o f th e t a b u l a t e d r e s u l t s was p o s s i b l e . A f t e r e l im in a t i n g i n a d e q u a te .y i e ld d a t a , t h e r e w ere 44 yield s e r i e s i n th e s p r in g w hea t a r e a and 68 i n th e w in te r w heat a r e a w i th 12 o r ' more y e a r s o f d a ta . The num bers o f y i e l d s e r i e s , by q r q a s , by th e number o f y e a r s i n th e s e r i e s a r e g iv e n i n T ab le I on th e f o l lo w in g p ag e . S e v e r a l o f th e y i e l d s e r i e s w ere n o t c o n tin u o u s . When a t tem p t in g to d e s c r ib e y e a r - t o - y e a r y i e l d v a r i a t i o n , t h i s p r e s e n t s a p rob lem — one t h a t do es n o t a r i s e when th e p rob lem i s w i th in y e a r y i e l d d i f f e r e n c e s . - Thus, a l l 112 y i e l d s e r i e s w ere u sed to d e s c r ib e yield d i f f e r e n c e s w i th in any one y e a r and f o r y e a r - t o - y e a r y i e l d v a r i a t i o n f o r th e a r e a s , b u t o n ly th e c o n tin u o u s s e r i e s o r th o s e l a c Jcing one y e a r w ere u s e d f o r y e a r - t o - y e a r c a l c u l a t i o n s . By e l im in a t i n g th e s e r i e s w i th g ap s o f more th a n one y e a r , th e u s a b le y i e l d s e r i e s w ere re d u c e d t o s i x t y sev en ,. 30 i n th e s p r in g w heat 21 T m m I . NUMBER CF H E ID SERIES FOR STATE-OWNED CROPLAND IN SELECTED COUNTIES H THE WINTER AND SPRING WHEAT AREA, BY NUMBER OF YEARS H SERIES„ ' _ S p r in g Whss t .Areg. ' W in te r Wheat A rew H a r s I Bp-Q S e y e l tA S h e r id a n C o u n tie s ) (F e rg u s & 'JnUi t h B a s in Cmm ti ep ) A l l Y ie ld ' C on tin u ou s o r A l l Y ie ld C on tin u o u s o r ‘ Sep i eg— — Sexi e r ----------M inus One Y ear________S e r i e s ' ■ M inns One Y ear • 'Number ' Number ' Number 12 I 0 I o . 13 0 0 2 0 14 ' 0 0 6 I 15 8 2 ■ 5 016 '3 3 9 417 15 13 9 518 5 • 3 14 1219 .10 8 11 620 1 0 • 9 ‘ 721 ■ 1 I I 022 0 0 I I 23 0 0 0 0 24 0 0 I I T o ta ls 44 30 ■ 68 37 a r e a and 3 7 ' i n th e w in te r w hea t a r e a . The number o f y i e l d s e r i e s e l im in a te d and r e t a i n e d by t h i s p r o c e s s a re shown i n T ab le I . The a c tu a l w hea t y i e l d p e r se ed ed a c re f o r e a ch y e a r and th e s im p le a v e ra g e w hea t y i e l d i / f o r e ach o f th e 67 s e r i e s i s shown i n i and I I o f A ppendix A0 T ab le I c o n ta i n s th e 30 y i e l d s e r i e s f o r th e s p r in g w heat a r e a . T ab le I I , t h e 37 w in te r w hea t a r e a s e r i e s . I / The s im p le a v e rag e i s u s e d w i th th e a ssum p tio n t h a t t h i s i s more r e p r e s e n t a t i v e th a n a w e ig h te d a v e ra g e o f a c tu a l y i e l d v a r i a b i l i t y . I n many o f th e y i e l d s e r i e s th e c o n d i t io n where n e a r l y a l l c ro p la n d a c re a g e w ould be se ed ed one y e a r and i n ' th e n e x t y e a r v e ry l i t t l e w ould be s e e d e d , was q u i t e common. W ith in th e same y e a r th e seeded a c re a g e would v a ry t o th e same o r a g r e a t e r e x t e n t . I n e i t h e r o f t h e s e c a s e s i t seems th e -w e ig h te d a v e ra g e would c r e a t e a g r e a t e r b i a s . - 22 - A lso in c lu d e d i n t h e s e t a b l e s a re th e a v e ra g e a c r e s o f w hea t se ed ed p e r y e a r f o r e a ch s e r i e s « The u s e o f th e s im p le a v e rag e w hea t y i e l d i n th e s e t a b l e s r e q u i r e s th e a ssum p tio n t h a t e a ch a c re w i th in a s e c t i o n i s id e n ­ t i c a l i n te rm s o f p r o d u c t io n . The f o l lo w in g maps,, p r e s e n te d a s F ig u r e s 4 and 5 , show th e r a n g e , to w n s h ip , . and s e c t i o n l o c a t i o n o f e a ch y i e l d s e r i e s i n t h e s e f o u r c o u n tie s= F ig u re 4 i s s p e c i f i c t o th e s p r in g w hea t c o u n t i e s , S h e r id a n and R o o s e v e l t , w h i le F ig u re 5 i s c o n c e rn ed w i th th e w in te r w hea t c o u n t i e s o f F e rg u s and J u d i t h B asin= The number d i r e c t l y be low e a ch t r a c t o f la n d i d e n t i f i e s th e t r a c t and th e s e c o rr e s p o n d w i th th e s e r i e s numbers fo und i n T ab le s I and I I o f A ppendix A. A l l y i e l d s e r i e s a re numbered th ro u g h e a ch row o f tow n sh ip s from w e s t t o e a s t p r o g r e s s in g from n o r th t o south= The o n ly r a t i o n a l b a s i s f o r t h i s c h o ic e was t h a t s to rm a c t i v i t y te n d s t o fo llo w a w e s t - t o - e a s t p a th i n t h e s e a r e a s . A lth o ugh th e p r e v a i l i n g movement seem s t o b e w e s t t o b a s t , s to rm s do f o l lo w a n o r th w e s t , - to - s o u th e a s t p a th i n th e s p r in g w hea t a r e a and a s o u th w e s t - to - n p r th e a s t p a th in. th e w in t e r w hea t a r e a . - 23 - o Oorlook 26. ------------- F ig u re 4» L o c a tio n o f S e le c te d S ta te -ow n ed T r a c ts o f C ro p lan d i n S h e r id a n and R o o se v e lt C o u n t ie s , Montana. 22 -----□ _ l — l___I L o c a tio n o f S e le c te d S ta te -ow n ed T r a c t s o f C rop land i n J u d i t h B a s in and F e rg u s C o u n t!s , M ontana. F ig u re 5 I n T ab le I I th e a v e ra g e y i e l d p e r se ed ed a c re by th e number o f y e a r s i n e a ch s e r i e s , i s g iv e n f o r th e 30 t r a c t s o f s ta te -o w n e d la n d i n th e s p r in g w hea t a r e a . T ab le I I I p r e s e n t s th e same in fo rm a t io n f o r th e 37 t r a c t s l o c a t e d i n th e w in te r w hea t a r e a . From th e s e t a b l e s , th e r e seem s to be no i n d i c a t i o n t h a t y i e l d s a r e s i g n i f i c a n t l y low e r on th e lo n g e r y i e l d s e r i e s . TABLE I I . AVERAGE YIELD PER SEEDED ACiffi FOR JO STATE-OtffiED TRACTS OF CROPLAND, BY NUMBER CF YEARS H EACH SERIES, SHERlDAN AND ROOSEVELT COUNTIES. — 25 — Y ea rs i n E ach S e r i e s 15. Ik n 17 ,5 •14.5 17.1 1 3 .2 1,3.8 15.1 12.8 15.1 14.9 13.8 1 3 .4 1 1 .9 1 1 .8 1 1 .7 11.1 9 .7 8 .5 6 ,2 1 3 .7 0 12 .33 I S 12 21 13.9 17 .3 1 1 .4 1 3 .7 1 5 .7 1 2 .4 1 4 .6 1 4 .4 1 4 .0 11 .5 1 1 .2 1 1 .2 13 .33 1 3 ,7 4 , 11.40Average 15 .35 — 26 — TABLE I I I . AVERAGE YIELD PER SEEDED ACRE FOR 37 STATE-OWNED TRACTS OF CROPLAND, BY NUMBER OF YEARS H EACH SERIES, JUDITH BASIN AND FERGUS COUNTIES. Y ea rs i n E ach S e r i e s a / l £ 1 2 '' ' ' V . I B ' 12 20 - 1 7 .2 2 0 .0 .29.3 . 2 1 .8 19 .5 1 7 .0 16.2 2 1 .0 16 .3 19 .0 1 3 .2 • 10.7 . 20,9 .15 .5 1 7 .8 1 2 .8 1Q,.6 7 .0 20 ,C .19 ,,7 1 7 ,9 1 6 ,8 1 6 .8 1 6 .4 1 2 .5 1 1 .7 1 1 .6 1 3 .4 1 1 .4 9.7 14.5 14*4 14.1 1 3 .4 A verage 15 .05 12.90 1 7 .8 8 14.68 16 .10 a / Three t r a c t s a re ^ o t in c lu d e d a s t h e r e i s o n ly one o b s e rv a t io n f o r aWoh t r a c t . These a r e : (1 ) .14 y e a r s e r i e s - 1 4 .9 b u s h e l s , (2 ) 22 y e a r s e r i e s - 1 8 .8 b u s h e ls ', and (3 ) 24 y e a r s e r i e s - 1 5 .8 b u s h e ls p e r s e ed ed a c r e . M easu res o f Y ie ld Y a r l a b i l i t v Two s t a t i s t i c a l m ea su re s w ere u s e d t o d e s c r ib e y i e l d v a r i a b i l i t y . - These a re th e s ta n d a rd d e v ia t i o n and th e c o e f f i c i e n t o f v a r i a t i o n . Hie fo rm e r i s a m easu re o f a b s o lu te v a r i a t i o n w h i le th e l a t t e r i s a m easure o f r e l a t i v e v a r i a t i o n . These m easu res w ere c a l c u l a t e d f o r e a c h group o f o b s e rv a t io n s by y e a r s and f o r e a ch y i e l d s e r i e s . I n T ab le I I I o f A ppend ix A y i e l d v a r i a b i l i t y i s d e s c r ib e d i n a b s o lu te and r e l a t i v e te rm s f o r th e y i e l d o b s e rv a t io n s c o n c e rn in g th e y e a r s '1938-56 f o r S h e r id a n and - 27 - R o o se v e lt c o u n t i e s . T ab le IV , A ppendix A, d e s c r ib e s y i e l d v a r i a t i o n i n th e same m anner f o r th e y e a r s 1937-56 f o r J u d i t h B a s in and F e rg u s c o u n t i e s . The s ta n d a rd d e v ia t i o n g iv e s th e a b s o lu te v a r i a t i o n i n w hea t y i e l d f o r t h e s e y i e l d d a t a . The c o e f f i c i e n t p f v a r i a t i o n g iv e s t h e r e l a t i v e v a r i a t i o n i n w hea t y i e l d f o r t h e s e y e a r s o f d a t a , th u s v a r i o u s c o e f f i ­ c i e n t s o f . v a r i a t i o n , c an b e com pared . To o b ta in m ea su re s o f y e a r - t o - y e a r v a r i a t i o n i n w hea t y i e l d , th e i d e n t i c a l ty p e c a l c u l a t i o n s w ere c om p le te d f o r th e 67 y i e l d s e r i e s . The r e s u l t s o f t h e s e c a l c u l a t i o n s a re fo u n d i n T ab le s V and V I i n A ppend ix A. The fo rm e r r e p r e s e n t s th e s p r in g w heat a r e a , t h e l a t t e p th e w in te r w hea t a r e a . . These t a b l e s i d e n t i f y th e y i e l d s e r i e s by number and c an t h e r e f o r e , I b e com pared t o th e l e g a l d e s c r i p t i o n a s fo u n d on F ig u r e s 4 and 5 and \ a ls o t o th e y e a r - t o - y e a r y i e l d s t h a t a re p r e s e n te d i n T a b le s I and i ; i l o f A ppendix A. Y e a r - to - y e a r Y ie ld V a r i a b i l i t y o f th e Group !D e sc r ib e d ' As shown i n f i g u r e 6 , f o r th e s p r in g - w hea t a r e a .th e r a n g e o f th e c o e f f i c i e n t 6 f v a r i a t i o n was 4 1 .6 p e r c e n t , from a low o f 2 7 .9 p e rc e n t i n 1947 to a h ig h o f 6 9 .5 p e r c e n t i n 1-949. I n th e w in te r w hea t a re a th e low was 4 0 ,4 p e r c e n t i n 1951} th e h ig h 6 0 .5 p e r c e n t i n 1954 . Thus, th e ra n g e f o r t h i s a r e a w ould be 20 .1 p e r c e n t , much low e r th a n th e 41 . 6. p e r c e n t ra n g e f o r th e s p r in g w hea t a r e a . — 28 — However, th e a v e ra g e v a r i a t i o n f o r th e 1 9 -y e a r p e r io d f o r th e s p r in g w hea t a r e a was 4 0 .8 4 p e r c e n t , t h i s com pares to th e 2 0 -y e a r p e r io d i n th e w in te r w hea t a r e a where th e a v e rag e v a r i a t i o n was 4 8 .4 5 p e r c e n t . C 0 e f f 1 c i e n t 0 f V a r 1 a t I o n F ig u re 6 . Y ie ld V a r i a t i o n by Y e a rs , S ta te -ow n ed C ro p lan d , S p r in g and W in te r Wheat A re a s . The c om pa riso n s o f th e c o e f f i c i e n t o f v a r i a t i o n i n F ig u re 6 a re f o r y e a r - t o - y e a r y i e l d v a r i a b i l i t y f o r a l l o b s e rv a t io n s w i th in th e two a r e a s . The d a ta f o r t h i s f i g u r e c an be found i n d e t a i l i n A ppendix A, T ab le s I I I and IV . P e r c e n t A verage 4 0 .5 P e r c e n t ------ W in te r Wheat A rea ------ S p r in g Wheat A rea 1 ' I tT - T 1937 ' 1940 Y ea rs - 29 - l a a r - tQ - y a a r Y ie ld V a r i a b i l i t y a s E x p e r ie n c ed bv th e Tndiv i dual The b a r c h a r t p r e s e n te d a s F ig u re 7 below summ arizes th e r e s u l t s o f T ab le s V and VI o f A ppendix A. These t a b l e s , and th e c h a r t , a re co n ce rn ed w i th y e a r - t o - y e a r y i e l d v a r i a b i l i t y on th e 67 t r a c t s o f s ta te -ow n ed c ro p la n d i n th e two a r e a s . The numbers and th e p e rc e n ta g e s o f th e t o t a l o b s e rv a t io n s t h a t f a l l w i th in e a ch c o e f f i c i e n t o f v a r i a t i o n c a te g o ry f o r e a ch a r e a a re shown. C o e f f i c i e n t o f V a r ia t io n 60 to 69% / / / / / / / 10.0% 2.7% 26.7%50 t o 59% / / / / / / / / / / / / / / / / / / z l 35.2% 40 to 49% / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / y 50.0%29.7% 30 t o 39% / / / / / / / / / 13.3%29.7% S p r in g Wheat A rea W in te r Wheat A rea 20 to 29% L 0* 2.7% T I I I i I I I I I I I I I I r 0 5 10 15 Number and P e r c e n t o f O b se rv a t io n s F ig u re 7 . Y ie ld V a r i a b i l i t y on 67 S ta te -ow n ed T r a c ts o f C ro p lan d , S p r in g and W in te r Wheat A re a s , M ontana. — 30 — As i n d i c a t e d by F ig u re 7 , o n e --h a lf o f th e s p r in g w hea t a r e a y i e l d o b s e rv a t io n s a re w i th in th e 40 t o 49 p e r c e n t c o e f f i c i e n t o f v a r i a t i o n c a te g o r y . When th e ra n g e i s from 40 t o 59 p e r c e n t , 77 p e r c e n t o f th e s p r in g w hea t o b s e rv a t io n s a re in c lu d e d . T he re w ere o b s e rv a t io n s fo und i n e a c h c o e f f i c i e n t o f v a r i a t i o n ■ c a te g o ry f o r th e w in t e r w hea t a r e a and on t h i s b a s i s th e w in te r w heat a r e a w ould be a l e s s homogeneous a r e a th a n th e s p r in g w hea t a r e a ; however,, an i n d iv i d u a l c o u ld e x p e c t to l i v e w i th g r e a t e r y i e l d v a r i a b i l i t y i n th e s p r in g w hea t a r e a C see F ig u re 7 ) . There was a ra n g e o f 30 .1 p e r c e n t i n th e c o e f f i c i e n t o f v a r i a t i o n f o r th e 3 0 - y i e l d s e r i e s i n th e s p r in g w hea t a r e a . F o r th e w in t e r w heat a r e a w i th 37 y i e l d s e r i e s , th e ra n g e was 37 .1 p e r c e n t . The lo w e s t c o e f f i c i e n t was 3 6 .0 p e r c e n t and th e h ig h e s t was 66 .1 p e r c e n t i n S h e r id a n and R o o se v e lt c o u n t i e s (T ab le V, A ppendix A ). I n J u d i t h .B a s in and F e rg u s c o u n t i e s , th e low d is c o v e r e d was 23 .3 p e r c e n t and th e h ig h was 6 0 .4 p e r c e n t (T ab le V I, Appendix A ). The a v e ra g e c o e f f i c i e n t s o f v a r i a t i o n w ere 4 8 . 15 p e r c e n t and 4 4 .6 6 p e rc e n t f o r th e s p r in g and w in te r w hea t a r e a s r e s p e c t i v e l y . I n d i c a t i o n s o f t h i s a r e e v id e n t i n F ig u r e 7 . Under b o th th e i n d iv i d u a l and th e g roup m easu res o f 'y p a r l t o -y e a r y ie ld " v a r i a b i l i t y th e a r e a ,w i th ^ th e ^ sm a^ le s tn ^ ep c en ta g e b a d g e :h a d th e h ig h e s t a v e ra g e c o e f f i c i e n t o f v a r i a t i o n . CHAPTER H I SHORT-RUN SURVIVAL In th e s h o r t - r u n , th e fa rm u n i t r e q u i r e s income t h a t i s ad equ a te to m eet minimum and non-rdef e r r a b le l i v i n g c o s t s and c a sh o p e r a t in g ex p en se s f o r s u r v i v a l . F a rm ’U n it E xp en se s Th© y e a r l y c o s t s o f th e assumed fa rm u n i t t h a t c a n be c o n s id e r e d f i x e d f o r t h i s s tu d y a r e p r e s e n te d "in T ab le I o f Appendix B . These a re th e y e a r l y c a s h o u t l a y s f o r th e l i s t e d i tem s t h a t would b e r e q u i r e d f o r f m*m u n i t u n d s r a z e ro y i e l d c o n d i t io n . The t o t a l d o l l a r r e q u i r e ­ m en ts and th e r e q u ir em e n t p e r se ed ed a c re f q r th e fa rm u n i t a re summarized i n T ab le IV b e low . As i n d i c a t e d , i n th e s p r in g w heat a r e a # 8 .2 0 p e r TABLE IV . TOTAL AND PER SEEDED ACRE FIXED CASH EXPENSE OF THE FARM UNIT BY AREAS.V ' Snriner W heat A rea W in te r Wheat A rea -Sca-. S o l . F irm f i x e d e x p en se s 4 ,3 5 0 .0 0 4 ,4 0 5 .0 0 H ouseho ld f i x e d e x p en se s .2 ,3 7 5 .0 0 2 ,3 6 0 .0 0 Farm u n i t f i x e d e x p en se s 6 ,7 2 5 .0 0 6 ,7 6 5 .0 0 F irm f i x e d exp en se p e r se ed ed a c re 5 .3 0 5 .3 7 H ouseho ld f i x e d exp en se p e r se ed ed a c re 2 .90 2 .8 8 Farm u n i t f i x e d expen se p e r se ed ed a c re 8 .2 0 8.25 —/ Ih e fa rm u n i t ’ s f i x e d c a sh e x p en se s a re th e minimum y e a r l y ex p en se s I th e f o u r—member h o u se h o ld and th e 1 ,6 4 0 c ro p a c re f i rm u n d e r a z e ro y i e l d c o n d i t io n . - 32 - s e ed ed a c re w ould be r e q u i r e d f o r s u r v i v a l o f th e fa rm u n i t f o r e ach y e a r t h a t a z e ro y i e l d i s e x p e r ie n c e d . d o l l a r p e r se ed ed a c re r e q u irem e n t f o r s u r v i v a l when a z e ro y i e l d i s e x p e r ie n c e d i n th e w in t e r w hea t a r e a w ould be | 8 . 25o Some o f th e f i r m 's c a sh ex p en se s c an be c o n s id e r e d f u n c t i o n s o f p r o d u c t io n w h i le o th e r s a re f u n c t io n s o f a c r e s . Those t h a t a r e f u n c t io n s o f p r o d u c t io n in c r e a s e a t a c o n s ta n t r a t e w i th y i e l d . Those t h a t a re f u n c t i o n s o f a c re a g e i n c r e a s e a t a c o n s ta n t , r a t e w i th a c r e s h a rv e s te d . Those c o s t i tem s t h a t a re in c lu d e d i n T ab le I o f A ppendix B a re ’ i tem s t h a t a re s p e c i f i c to th e s i z e o f fa rm i n a c re a g e a n d /o r i n te rm s o f th e s i z e o f th e h o u se h o ld assumed i n C h ap te r I . Thus> th e y c an be c o n s id e r e d f i x e d f o r t h i s s tu d y . I n t h i s t a b l e t h e r e a re no c o s t s c a l c u l a t e d f o r g r a i n h a n d l in g o r h a r v e s t in g . I f t h e r e i s no c ro p th e r e c a n be no c a s h exp en se c h a rg e a b le to t h e s e i te m s . The h i r e d l a b o r ' e x p e n se ^ i n c lu d in g room and b o a rd , th e p ic k u p and t r u c k e x p e n se s , and th e e x p e n se s f o r s u p p l i e s and m is c e l la n e o u s i tem s a re in c lu d e d i n Table I b u t a t a minimum l e v e l , a l e v e l assumed t o be c o n s i s t e n t w i th a ze ro y i e l d . G ra in h a n d lin g and p ic k u p and t r u c k c o s t s a re c o n s id e r e d f u n c t io n s o f p r o d u c t io n . The in c r e a s e i n c o s t a s y i e l d i n c r e a s e s i s i n a o n e - to -o n e r a t i o . T h is i s t r u e r e g a r d l e s s o f th e y i e l d p e r se ed ed a c re a s th e c o s t i s c q l c u l a t e d on a b u s h e l b a s i s . However, th e i n c r e a s e s i n th e o th e r t h r e e exp en se i tem s a r e f u n c t io n s o f th e a c re a g e h a rv e s te d ; t h e r e f o r e , a t some y i e l d l e v e l th e y w i l l n o t i n c r e a s e f u r t h e r . T h is r e q u i r e s an - 33 - a s STmpMcm' c o n c e rn in g th e y i e l d l e v e l s t h a t w ould e n co u rag e th e f a rm e r to h a r v e s t a l l t h e se ed ed a c re a g e . The f o l lo w in g a s sum p tio n s w ere made: I n th e .sp r in g w hea t a r e a : ( l ) i f t h e av e rag e y i e l d jp er se ed ed a c re was above 9 .3 b u s h e ls th e .c o s ts would be c a l c u l a t e d by assum ing a l l th e se ed ed a c re a g e was h a rv e s te d ; (2 ) i f ' th e c ro p was b e tw een 6 .3 and 9 .3 b u s h e ls p e r seed ed a c r e , t h r e e f o u r t h s o f th e a c re a g e w ould be h a ry e s te d ; (3 ) when th e c ro p was b e tw een 4 .1 and 6 .3 b u s h e l s , one h a l f o f th e a c re a g e ,w a s h a r ­ v e s te d ; (4 ) o n ly one f o u r t h o f th e c ro p would be h a rv e s te d i f th e y i e l d was b e tw een 2 .2 and 4 .1 ; (5 ) any y i e l d b e low 2 .2 b u s h e ls p e r se ed ed a c re was c o n s id e r e d a z e ro y i e l d . I n th e w in t e r w h e a t a r e a : ( l ) a y i e l d above 1 0 .5 b u s h e ls r e q u i r e s h a r v e s t in g a l l se ed ed a c re a g e ; (2 ) a y i e l d b e tw een 6 .7 and 10..5 was e q u iv a le n t to t h r e e f o u r t h s o f th e a c re a g e b e in g h a rv e s te d ; (3 ) one h a l f o f th e a c re a g e was h a rv e s te d f o r y i e l d s b e tw een 4 .3 and 6 .7 ; (4 ) one f o u r t h was h a r v e s t e d when th e y i e l d was b e tw een 2.3"and 4.3; Cd) a y i e l d below 2.3 was c o n s id e r e d a z e ro y i e l d . The i n c r e a s e i n c o s t s due to th e i n c r e a s e d y i e l d a t t h e s e s p e c i f i e d l e v e l s Was c a l c u l a t e d . When th e se ed ed a c re a g e was a l l h a r v e s t e d , th e 9 .3 and 1 0 .5 b u s h e l y i e l d c o n d i t io n s , th e c a s h e x p en se s o f th ese " f i rm s w ou ld i n c r e a s e o n ly due t o in c r e a s e d c o s t o f g r a i n h a n d lin g and p ickup and t r u c k e x p en se ; t h u s , any in c r e a s e i n c o s t would be a t a c o n s ta n t r a t e above th e s e y i e l d l e v e l s . A lso,- once th e number o f a c r e s assumed to b e h a rv e s te d was d e te rm in e d , h a r v e s t in g c o s t s can be c o n s id e r e d as i n c r e a s i n g a t a c o n s ta n t r a t e b e tw een e a ch o f th e s e y i e l d l e v e l s . U sing th e s e a s sum p tio n s , e x p en se s c o u ld be c a l c u l a t e d f o r th e fa rm u n i t f o r e a c h o r any y i e l d l e v e l . I n T ab le s I I and I I I o f Appendix. B th e fa rm u n i t e x p e n se s a re g iv en f o r d i f f e r e n t y i e l d l e v e l s . Thpse c a l c u l a t i o n s a re on a s e ed ed a c re b a s i s . - 34 - Farm U n it Iannme The, d e te rm in a t io n o f th e p r o f i t o r l o s s a t e a ch y i e l d l e v e l , and ■ a l s o t o l o c a t e th e b re a k e v e n y i e l d f o r s u r v i v a l r e q u i r e s th e c a l c u l a t i o n o f th e g r o s s incom e p e r se ed ed a c re f o r e a ch y i e l d l e v e l . Once income and exp en se in f o rm a t io n a re a v a i l a b l e , i t i s a .s im p le m a t te r to d e te rm in e th e fa rm y i e l d n eed ed to c o v e r a l l o r any p r o p o r t io n o f th e fa rm u n i t ' s expenses= A lso , one c an d e te rm in e th e income p o s i t i o n o f th e fa rm u n i t g iv e n d i f f e r e n t y i e l d l e v e l s when t h i s in f o rm a t io n i s a v a i la b le = To d e te rm in e g r o s s incom e th e f o l lo w in g a s sum p tio n s and n o t a t i o n s w ere u s e d : 1 . A ssum p tion s c o n c e rn in g p r i c e s . B a s is f o r t h e s e a ssum p tio n s a re A g r i c u l t u r a l P r i c e and C ost P r o j e c t i o n s . a . Wheat p r i c e f o r th e .S ta te o f M ontana is - $ 1 .5 5 p e r b u s h e l . b . Wheat p r i c e f o r th e s p r in g w heat a r e a i s $ 1 .6 0 p e r b u s h e l . C= Wheat p r i c e f o r th e w in t e r w hea t a r e a i s $ 1 .5 0 p e r b u s h e l . d . B a r le y p r i c e f o r th e S t a t e o f M ontana i s $ .9 7 p e r b u s h e l . e . B a r le y p r i c e f o r th e s p r in g w hea t a r e a i s $ .9 9 p e r b u s h e l . f . B a r le y p r i c e f o r th e w in t e r w hea t a r e a i s $ .9 5 p e r b u s h e l . 2 . A ssum p tion s c o n c e rn in g y ie ld s = B a s is f o r t h e s e a ssum p tio n s a re M ontana A g r i c u l t u r a l S t a t i s t i c s , w heat and b a r l e y y i e l d d a t a f o r th e y e a r s 1938 -57 . a . B a r le y y i e l d i n th e s p r in g w hea t a r e a i s 130 p e rc e n t . o f th e w hea t y i e l d . b . B a r le y y i e l d i n th e w in te r w hea t a r e a i s 135 p e r c e n t o f th e w hea t y i e l d . Hj CD - 35 - 3 . A ssum p tion s c o n c e rn in g c ro p s to b e se ed ed . These a ssum p tio n s ' a re b a s e d on th e c u r r e n t a g r i c u l t u r a l p rog ram . a . Tjip se ed ed a c re a g e b a s e i s e q u a l t o o n e - h a l f th e c ro p la n d a c re a g e . b . The fa rm u n i t i s o p e ra te d u n d e r com p lian ce w i th th e p r e s e n t p rog ram , t h e r e f o r e 3 0 'p e r c e n t o f th e seed ed a c re a g e b a s e i s r e s t r i c t e d from w heat p r o d u c t io n . c . The r e s t r i c t e d a c re a g e i s se ed ed to b a r l e y ; t h e r e ­ f o r e , .3 o f e a ch peeded a c re i s assumed t o be se ed ed to b a r l e y , .7 se ed ed t o w h ea t. 4 . N o ta t io n s u s e d . a . G ross incom e p e r se ed ed a c re i n th e s p r in g w hea t a r e a - I 0w b . G ro ss incom e p e r se ed ed a c re i n th e w in t e r w hea t aroa = Ihw . c . B a r le y y i e l d = By d . B a r le y p r i c e = Bp . Wheat y i e l d = Wy . Wheat p r id e = Wp 5 o D e r iv a t io n o f th e income e q u a t io n s . a ° ^sw o r ^ww- ~ '^ (B y " Bp) + .7 (Wy • Wp) b . I n th e s p r in g w hea t a r e a By = 1 .3 Wy , Bp = .61875 Wp and Wp = $ 1 .6 0 , t h e r e f o r e (1 ) Igw = -3 ( 1 .3 Wy - .61875 Wp ) + .7 (Wy . $ 1 .6 0 ) (2 ) I g w - .3 ( 1 .3 Wy • $ ..99 ) .+ .7 ($1.60Wy ) (3 ) I s w - .3 ($1.287Wy ) + .7 ($1.60Wy ) (4 ) I sw = $ .3 8 6 1 Wy + $ 1 ,1 2 Wy (5 ) I sw - $ 1 .5 0 61 Wy c . I n th e w in t e r w hea t a r e a By = 1 .3 5 Wy , Bp = .6333 Wp and Wp = $ 1 .5 0 , t h e r e f o r e (1 ) I ww = .3 (l.3 5W y . .6333Wp ) + .7(Wy • $ 1 .5 0 ) (2 ) I ww = .3 (l.3 5W y . $ .9 5 ) + .7($1.50W y ) (3 ) I ww = .3($1.2825W y ) + .7($1.50W y ) (4 ) I ww = $ .38275 Wy t $ 1 .0 5 Wy (5) Iww = $I^%75 Wy - 36 - W ith th e s e two incom e e q u a t io n s , I sw = .$ 1 .5 0 6 1 Wy and I ww = I l i 43475 W , th e g r o s s incom e c a n be d e te rm in e d from any g iv e n y i e l d . A lso , g iv e n ' ' some l e v e l o f g r o s s incom e p e r se ed ed a c re th e w hea t y i e l d e q u iv a le n t c a n be d e te rm in e d . I t i s to be n o te d t h a t th e d b l l a r income p e r seed ed a c re r e c e iv e d from th e s e c a l c u l a t i o n s i n c o r p o r a t e s th e incom e r e c e iv e d from b o th b a r l e y and w h e a t. T h is e n a b le s one t o ap p ly t h e s e fo rm u la s d i r e c t l y t o th e y i e l d s e r i e s d e r iv e d i n t h e fo rn le r c h a p te r and th e income p e r se ed ed a c re amount assum es t h a t th e f a rm e r i s o p e r a t in g h i s u n i t u n d e r c u r r e n t a c re a g e r e s t r i c t i o h s . Farm U n it Income and Exoense ___ : ■ : — • I n T ab le s I I and I I I o f A ppendix B th e l o s s o r p r o f i t p e r seeded a c re and i n d o l l a r te rm s f o r th e fa rm u n i t h a s b een c a l c u l a t e d f o r v a r i ­ ou s y i e l d l e v e l s up t o th e s u r v iv a l y i e l d . T h e s e c a l c u l a t i o n s a re b a s e d upon th e income e q u a t io n s g iv e n above and th e ex p en se c a l c u l a t i o n s d i s c u s s e d p r e v io u s ly . The fa rm u n i t y i e l d rem a in in g a f t e r th e l a n d l o r d 's S hare i s p a id is ; t h r e e f o u r t h s o f t h e fa rm y i e l d i n t h e s p r in g w heat a r e a and two t h i r d s o f th e fa rm y i e l d i n th e w in te r w hea t a r e a . I n th e s p r in g w heat a r e a . T ab le I I o f A ppend ix B, th e fa rm u n i t ' s l o s s p e r y e a r due to a l / T h is l o s s o r p r o f i t i s te rm ed fa rm u n i t n e t c a sh in com e. Farm u n i t n e t c a s h income i s c a l c u l a t e d by d e d u c t in g th e c a sh e x p e n se s o f th e f i rm , income t a x e s , and f am ily l i v i n g e x p e n se s . As su c h , t h i s incom e c a n b e C o h s id e re d th e n e t incom e t o a fa rm u n i t i n th e s h o r t - r u n . - 37 - z e ro y i e l d i s $ 6 ,7 2 4 , A z e ro y i e l d i n th e w in te r w hea t a r e a . T ab le TTTj r e s u l t s i n a t o t a l l o s s t o th e fa rm u n i t o f $ 6 ,7 6 5 . The a c tu a l y i e l d l e v e l and th e fa rm u n i t s h a re th e i n s u r e s s u r v iv a l i n th e s h o r t ' r u n a re shown i n th e s e t a b l e s f o r b o th a r e a s . The s p r in g w hea t a r e a fa rm y i e l d i s 8 .8 — fa rm u n i t s h a re i s 6 .6 — b u s h e ls p e r s e ed ed ac r.e . I n th e w in t e r w hea t a r e a th e fa rm y i e l d i s 1 0 .6 , th e fa rm u n i t y i e l d i s 7 .07 b u s h e ls p e r se ed ed a c r e . R e se rv e s R eq u ire d f o r S u r v iv a l i n th e Short--Rnn Ag p r e v io u s ly m en tio n e d , th e amount o f r e s e r v e s n eed ed t o in s u r e s u r v i v a l o f th e fa rm u n i t t h a t o b t a in s a z e ro y i e l d i s $ 6 ,7 2 4 f o r th e s p r i n g w hea t a r e a and $ 6 ,7 6 5 f o r th e w in t e r w hea t a r e a . T h e r e fo r e , when o r i f th e f a rm e r e x p e r ie n c e s , t h r e e su ch y e a r s i n s u c c e s s io n , th e r e s e r v e d n eed ed to i n s u r e s u r v iv a l would b e $20 ,172 and $ 2 0 ,2 9 5 f o r th e s p r in g and w in te r w heat a r e a s r e s p e c t i v e l y . . E s t im a te s w ere r e q u i r e d o f th e d o l l a r amounts o f r e s e r v e s needed to i n s u r e s u r v i v a l o f th e fa rm u n i t o v e r a t h r e e - y e a r t im e p e r io d when y i e l d s w ere a t o r be low th e s u r v iv a l l e v e l . A t th e s u r v i v a l y i e l d income i s a d eq u a te t o c o v e r th e c a s h e x p en se s o f th e f i rm and h o u se h o ld . Cash ex p en se dope n o t in c lu d e a c h a rg e f o r d e p r e c i a t i o n ; t h i s i s an added ex p en se when s u r v i v a l i n th e lo n g - r u n i s c o n s id e r e d . F ou r y i e l d l e v e l s r a n g in g from th e s u r v i v a l y i e l d l e v e l down t o th e z e ro y i e l d s i t u a t i o n w ere s e l e c t e d f o r e a ch a r e a . These y i e l d l e v e l s a re i d e n t i f i e d as I , 2 , 3 , and, 4 i n T ab le s IV and V i n A ppend ix B. The one y i e l d l e v e l — 38 — r e p r e s e n t s a z e ro y i e l d ; t h e r e i s no incom e r e c e iv e d from th e fa rm u n i t , A* th e two y i e l d l e v e l th e n e t income to th e fa rm u n i t i s a d e q u a te to c o y e r th e h o u seh o ld c o s t s . The h o u seh o ld e x p e n se s and one h a l f th e f i r m 's e x p e n se s a r e r e c o v e r e d when th e y i e l d l e v e l i s i d e n t i f i e d a s a t h r e e . At th e f o u r y i e l d l e v e l income i s s u f f i c i e n t t o c o v e r th e f i rm and h o u seh o ld e x p e n se s . The f o u r y i e l d i s th e s u r v iv a l y i e l d l e v e l o f T a b le s I I and. I l l o f A ppendix B. A l l p o s s ib l e c om b in a tio n s o f th e s e f o u r y i e l d l e v e l s a r e t e s t e d o v e r . t h r e e - y e a r t im e p e r io d s w i th th e r e s u l t s b e in g p r e s e n te d i n T ab le s W and V o f A ppend ix B. These t a b l e s show th e d o l l a r am ounts o f r e s e r v e s n eed ed f o r s u r v i v a l i n t h e s h o r t ' ru n f o r e a ch p o s s ib l e c om b in a tio n o f t h e f o u r y i e l d l e v e l s . These r e s u l t s a re summarized i n T a b le s T and T I on th e f o l lo w in g p a g e s . The o rd e r o f t h e s e c om b in a tio n s i s im p o r ta n t ; th e f i r s t d i g i t i n a s e r i e s i s th e y e a r one y i e l d ; th e second d i g i t th e y e a r two y i e l d ; and th e t h i r d th e y e a r t h r e e y i e l d . The d o l l a r amount o f r e s e r v e s r e q u i r e d f o r s u r v i v a l i s i d e n t i c a l fo r. s e v e r a l o f t h e s e c om b in a tio n s . F o r example a 113 , a 131 , and a 311 w i l l r e q u i r e th e same amount o f r e s e r v e s o v e r th e t h r e e - y e a r p e r io d f o r s u r v i v a l a s , i n d i c a t e d i n th e f o l lo w in g two t a b l e s . However, a l th o u g h th e d o l l a r amounts a r e i d e n t i c a l , e a ch o f t h e s e s e r i e s r e q u i r e d i f f e r e n t m anagement by th e fa rm u n i t . I n th e exam ple c i t e d , above , th e s i t u a t i o n w here two z e ro y i e l d s a r e fo llo w e d by a y i e l d where t h e o p e r a t o r 's l o s s i s o n ly e q u iv a le n t t o one h a l f th e c a s h expen se - 39 - r e q u i r e s somewhat d i f f e r e n t management from th e s i t u a t i o n w here th e z e ro y i e l d s a r e s p l i t by th e t h r e e y i e l d . I n th e t a b l e s on th e f o l lo w in g p a g e s , th e d o l l a r am ounts o f r e s e r v e s r e q u i r e d a r e g ro up ed . These l i s t i n g s show th e v a r io u s c om b in a tio n s t h a t r e q u i r e th e same amount o f r e s e r v e s .a n d l i s t th e d o l l a r am ounts i n o rd e r o f m ag n itu d e . By r e f e r r i n g t o T a b le s I , I I , and I I I i n Appendix B th e fa rm a n d /o r fa rm u n i t y i e l d l e v e l s . t h a t c o rre s p o n d t o th e income s i t u a t i o n s r e p r e ­ s e n te d by th e fo u r , y i e l d l e v e l s c an b e d e te rm in e d . F o r th e s p r in g w heat a r e a th e one y i e l d s i t u a t i o n r e q u i r e s # 6 ,7 2 4 . T h is , o f c o u r s e , i s th e z e ro y i e l d s i t u a t i o n fo u n d i n row one o f T ab le I I . The two y i e l d con­ d i t i o n r e q u i r e s # 4 ,3 5 0 ( f i rm e x p en se s i n T ab le I ) and by c h e c k in g Tab le I I i t i s se en t h a t a fa rm u n i t l o s s o f #4 ,350 c o r r e s p o n d s to a fa rm y i e l d b e tw een 3 .1 and 3 .2 . T h is i s e q u a l t o a 2 .3 2 5 to 2 .4 b u s h e l y i e l d p e r s e ed ed a c re f o r th e fa rm u n i t . S im i la r c h e ck s f o r . th e o th e r y i e l d l e v e l s c a n be made. When y i e l d s a r e above th e s u r v iv a l y i e l d r e q u i r e d i n t h e s h o r t - r u n , t h e r e i s income a v a i l a b l e f o r lo n g ru n s u r v i v a l — th e t o p ic to be c o n s id e r e d i n th e f o l lo w in g c h a p te r . TABLE Vo BLEFEgENT YIELD C OEB!NATIONS AND THE DOLLAR RESERVE REQHIREEENT FOR- SURVIVAL OVER TNO AND THREE-YEAR TIME PERIODS. SPRING WHEAT AREA. T h re e -y e a r Two-year R ese rv e T h re e -y e a r Y ie ld R ese rv e Two-year Y ie ld R equ irem en t C om binatioha/:.: R equ iren len t G om b in a ti o n a / D o l, 2 0 ,1 7 2 111 13 ,448 i n , J i ? , . . -113 , 114 ■ V 17 ,797 112 , 121 , 211 11 ,073 121 , 122, 123, 1.24, 211 , 212 , 213, 214 15,622 H 3 , 131 , 311 8,898 131 , 132, 133 , 134 , 311 , 312 , 313 , 314 15,422 122, 212 , 221 8,698 221 , 222, 223, 224 13 ,4 48 i u , 141 , 411 6,724 141 , 142, 143 > 144 , 411 , 412 , 413 , 414 13,247 123, 132, 213 , 231 , 312 , 321 6,523 • 231, 232, 233, 234, 321 , 322, 323, 324 13 ,047 222 4,349 241, 242, 243, 244, 421 , 422, 423, 424 11 ,073 124 , 142 , 214 , 241 ■, • 412', 421 4,348 331, 332, 333, 334 11 ,0 72 133 ; 313 ; 331 • 2 ,174 341 , 342, 343, 344 , 431, 432, 433, 434 10 ,8 7 2 223, 232, 322 0 ‘ 441 , 4/2, 443, 444 8,898 134, 143 , 314, 341 , 413, 431 8,698 224, 242, 422 8,697 233, 323, 332 6,724 144 , 414 , 441 6,523 234, 243, 324, 342, 423i 432 s / The f i r s t d i g i t i n e a ch o f th o s e c om b in a tio n s i s th e y e a r one y i e l d , th e second d i g i t i s th e y e a r two y i e l d , and th e t h i r d d i g i t i s th e y e a r t h r e e y i e l d . Thp fa rm y i e l d s a s s o c i a te d w i th t h e s e n um e ra ls a r e : 1 = 0 b u s h e ls ; 2 * 3 . 1 to 3 .2 b u s h e ls ; 3 = 6 .0 to 6 ,1 b u s h e ls ; 4 = 8 .8 b u s h e ls p e r se ed ed a c r e . At th e 8 , 8 . b u s h e l y ie ld , in c o m e t o th e fa rm u n i t i s a d e q u a te t o c o v e r th e c a sh e x p en se s o f th e f i rm and h o u seh o ld . TABLE V Io DIFFERENT HELD GOEB!NATIONS AND THE DOLLAR RESERVE REQUIREMENT FOR SURVIVAL OVER WO AND THREE-YEAR TIME PERIODS, WINTER WHEAT AREA, T h re e -y e tir Two-year R ese rv e T h re e -y e a r Y ie ld R e se rv e Two-year Y ie ld R equ irem en t C om b in a tio n s / R equ irem en t C om b iN ationa / S o l o . 20,295 111 13 ,530 111 , 1 12 , 113 , 114 .17,935' 112 , 121 , 211 11 ,170 121 , 122, 1.23, 124, 211 , 212, 213, 214 15,733 113 , 131 , 311 3,968 131 , 132 , 133 , 134 , 311 , 312 , 313 , 314 15,575 122 , 212, 221 8,810 221 , 222 , 223, 224 13,530 . 114 , 141 , 411 6,765 141 , 142 , 143 , 144 , 411 , 412 , 413 , 414 13,373 123, 132 , 213, 231, 312 , 321 6 ,6 0 8 231 , 232, 233, 234, 321, 322, 323, 324 13,215 222 4 ,4 0 6 331 , 332, 333, 334 11 ,1 71 133 , 313 , 331 4,405 241 , 242, 243, 244, 4 21 , 422,' 423, 424 11 ,170 124 , 142, 214, 241, 412, 421 2,203 . 3 41 , 342, 343, 344, 431, 432, 433, 434 11 ,013 223, 232, 322' 0 ' . 4 41 , 442 , 443, 444 8,968 134, 143 , 314, 341, 413, 431 8 ,8 11 233, 323, 332 8,810 224, 242, 422 6,765 144, 414 , 441 6,609 333 6 ,6 0 8 234, 243, 324, 342, 423, 432 - 4,406 334, 343, 433 4,405 244, 424, 442 2,203 344, 434, 443 O 444 s / The f i r s t d i g i t i n e a ch o f t h e s e c om b in a tio n s i s t h e y e a r one y i e l d , th e second d i g i t i s th e y e a r two y i e l d , and th e t h i r d , d i g i t i s th e y e a r t h r e e y i e l d . lfie fa rm y i e l d s a s s o c ia te d w i th t h e s e num era l's a r e ; 1 * 0 b u s h e ls ; 2 = 3 .8 t o 3 ,9 b u s h e ls ; 3 - 7 .3 to 7 .4 b u s h e ls ; 4 = 1 0 .5 b u s h e ls p e r se ed ed a c r e . A t th e 1 0 .5 b u s h e l y i e l d , incom e i s ad eq u a te to c o v e r th e c a sh e x p en se s o f th e f i rm and h o u se h o ld . CHAPTER IV SURVIVAL AND CAPITAL ACCUWLATION F o r th e fa rm u n i t t o s u rv iv e i n th e lo n g r u n , n e t c a s h Income must be a d eq u a te t ’o i n s u r e s u r v i v a l i n th e s h o r t r u n and to a l l o y re p la c em en t o f equ ipm en t and m a in te n an c e o f b u i ld i n g s o v e r t im e . F o r c a p i t a l accumu­ l a t i o n t h e r e m ust b e s u r p lu s fa rm u n i t n e t c a s h income a f t e r lo n g ru n s u r v i v a l i s a s s u r e d . B e fo re ' th e s u r p lu s n e t c a s h income o f th e fa rm u n i t c a n be d e te rm in e d th e amount £>f su ch income r e t a i n e d i n l i q u i d fo rm to i n s u r e s u r v i v a l i n th e s h o r t and lo n g run- m u s t 'b e . known.'.. S h o r t Run S u r v iv a l : ~ :------------ A t l e a s t i n th e b e g in n in g , th e am ounts o f r e s e r v e s t h a t seem to be n e c e s s a r y f o r s u r v i v a l o f th e fa rm u n i t i n th e s h o r t r u n w i l l be main­ t a i n e d i n a n e a r l i q u i d fo rm . Cash i n th e b ank and g r a i n s to r e d on th e fa rm a re th e two k in d s o f l i q u i d r e s e r v e s t h a t w i l l be exam ined and ' com pared . However, t o ea,se th e c a l c u l a t i n g p ro c e d u re , th e g r a i n t h a t i s s t o r e d on th e fa rm w i l l b e c o n s id e r e d n o t i n b u s h e l fo rm b u t i n te rm s o f d o l l a r e q u iv a l e n t s . T h e s e ,r e s e r v e s w i l l be m a in ta in e d , when p o s s ib l e , i n an unencum bered fo rm , th e c a s h w i l l n o t be in v e s te d and th e g r a in w i l l h o t b e s u b je c t to l o a n s . The r e s e r v e s a r e a v a i l a b l e a t a l l t im e s to i n s u r e s u r v i v a l o f th e fa rm u n i t u n d e r s h o r t r u n c o n d i t i o n s . These r e s e r v e s w i l l be u t i l i z e d t o i n s u r e a l l t h e y e a r l y c a sh e x p e n se s o f th e f i rm and h o u se h o ld . They w i l l n o t be u s e d f o r r e p la c e m e n t ,o f equ ipm en t o r m a in te n an c e o f b u i l d i n g s . - 43 - R e se rv e s have no in com e -p ro d u c in g a b i l i t y when th e y a re h e ld i n t h e s e fo rm s ; i n f a c t , th e r e t u r n o v e r t im e may b e n e g a t i v e . Thus, th e amount o f income r e t a i n e d f o r th e s p e c i f i c p u rp o se o f i n s u r i n g s h o r t r u n s u r v i v a l sh o u ld bp a s sm a ll a s p o s s i b l e . Two d i f f e r e n t m ethods w ere u se d i n a t te m p t in g t o d e te rm in e a l i q u i d r e s e r v e l e v e l t h a t w ould p ro v id e a d eq u a te s u r v i v a l p r o t e c t i o n w i th th e lo w e s t p o s s ib l e c a s h income comm itm ent. v I n C h ap te r I I I t h e d o l l a r amounts o f r e s e r v e s t h a t w ou ld be r e q u i r e d t o i n s u r e s u r v iv a l f o r t h r e e - y e a r t im e p e r io d s were c o n s id e r e d f o r d i f f e r e n t y i e l d c om b in a tio n s . I n th e p r e s e n t c h a p te r th e maximum d o l l a r am ounts t h a t w ould be r e q u i r e d a t any one tim e when th e tim e p e r io d was e x te n d e d w ere c a l c u l a t e d . Thp r e s u l t s . o f t h e s e c a l c u l a t i o n s , d is c u s s e d b e low , w i l l p ro v id e in f o rm a t io n t h a t w i l l be o f v a lu e i n d e te rm in in g th e l i q u i d r e s e r v e r e q u ir em e n t f o r v a r io u s fa rm u n i t s . Xt i s u n l i k e ly t h a t th e fa rm u n i t c o u ld s u rv iv e o v e r th e lo n g ru n i f th e r e s e r v e r e q u ir em e n t u n d e r s h o r t r u n c o n d i t io n s becomes l a r g e r th a n th e d o l l a r amount n e c e s s a r y when t h r e e z e ro y i e l d y e a r s i n a row a re expe­ r i e n c e d . Thp fa rm u n i t w ould e i t h e r be u n a b le t o accum u la te t h i s amount o f r e s e r v e s o r i f th e y c o u ld do s o , i t w ou ld be u n e co n om ica l. As shown i n C h ap te r I I I , t h e d o l l a r amount o f r e s e r v e s n e c e s s a ry f o r t h e s i t u a t i o n in v o lv in g t h r e e z e ro y i e l d s i n a row was $ 2 0 ,1 7 2 i n th e s p r in g w heat a r e a and $20 ,2 95 i n th e w in t e r w hea t a r e a . These d o l l a r am oun ts w i l l be d e f in e d a s th e maximum amount o f l i q u i d . r e s e r v e s any one fa rm u n i t w ould a t tem p t t o m a in ta in . ~ K K - The p rob lem f o r th e f o l lo w in g p a r t o f t h i s c h a p te r i s t o d e te rm in e a r e a s o n a b le l i q u i d r e s e r v e amount t h a t th e fa rm u n i t c o u ld be e x p e c te d t o a t tem p t t o m a in ta in o v e r t im e . I t i s e x p e c te d t h a t t h i s r e s e r v e amount w i l l be a t some l e v e l be low th e d e f in e d maximum and w i l l v a ry to some e x t e n t w i th th e y i e l d l e v e l o f th e b u d g e te d fa rm u n i t . S h o r t Run S u r v iv a l s i n T ime S e r ie s By a p p ly in g th e incom e and exp en se in fo rm a t io n c o n ta in e d i n T ab les I I and I I I o f A ppend ix B t o th e y i e l d s e r i e s o f T ab le s I and I I o f Appen­ d ix A, th e maximum amount o f r e s e r v e s r e q u i r e d a t any one tim e f o r e ach s e r i e s c a n be d e te rm in e d . These amounts sp ec ify - th e maximum r e s e r v e r e q u i r em e n ts a t any one tim e f o r s u r v i v a l u n d e r s h o r t ru n c o n d i t io n s . The know ledge o f " th e se a c c um u la t iv e r e s e r v e r e q u i r em e n ts ( t h e a p p l i c a b le d o l l a r amount i s added f o r e a ch y i e l d b e low th e s u r v iv a l y i e l d , sub­ t r a c t e d f o r e a ch y i e l d above th e s u r v i v a l y i e l d ) w i l l p r o v id e a b a s i s f o r e s t im a t in g th e l i q u i d r e s e r v e re q u ir em e n t f o r e a ch y i e l d s e r i e s and f o r e a c h y i e l d g roup w i t h in th e a r e a s . When y i e l d s a r e be low th e s u r v iv a l l e v e l th e amount o f r e s e r v e s r e q u i r e d oan be d e te rm in e d d i r e c t l y from e i t h e r T ab le I I o r I I I i n A ppend ix B . When y i e l d s a r e above th e s u r v i v a l l e v e l th e fa rm u n i t n e t c a s h income o an be d e te rm in e d by u s in g th e income and ex p en se e q u a t io n s from th e p r e c e d in g c h a p te r . However, t h e fa rm u n i t ex p en se a s p r e v io u s ly - 45 - c a l c u l a t e d d o e s n o t d e d u c t income t a x j t h e r e f o r e ^ th e ex p en se amounts a r e o n ly c lose) e s t im a t e s = 4 / An Sxample o f th e c a l c u l a t i o n p ro c e d u re u sed t o d e te rm in e th e m axi­ mum r e s e r v e r e q u ir em e n t a t any ' ohe tim e i s p r e s e n te d u s in g y i e l d s e r i e s t h r e e i n th e s p r in g w hea t a r e a (T ab le I , A ppendix A)„ Qf th e 17 y e a r s o f y i e l d d a t a i n t h i s s e r i e s , t h e r e a re f i v e y e a r s when th e fa rm y i e l d i s b e low 8 .8 b u s h e ls p e r s e ed ed a c r e . Thpse y i e l d s a re u se d i n column onq, ( fa rm y i e l d ) T ab le I I o f A ppendix B. The f i r s t y i e l d b e low th e s u r v iv a l l e v e l i s 5 .1 b u s h e l s , and by v i s u a l i n s p e c t io n o f T ab le I I i t i s s e en t h a t $ 2 ,9 03 w i l l be n eeded to i n s u r e s u r v i v a l u n d e r s h o r t ru n c o n d i t i o n s , g iv e n t h i s y i e l d . The n e x t y e a r th e fa rm y i e l d i s 6 .2 b u s h e ls ; t h e r e f o r e , an a d d i t i o n a l $2 ,075 would b e r e q u i r e d . The r e q u ir em e n t f o r th e t h i r d y e a r i s $308 . T h e re fo re , b e f o r e a y i e l d above th e s u r v iv a l l e v e l i s fo u n d , th e t o t a l r e s e r v e r e q u ir em e n t f o r s u r v i v a l u n d e r s h o r t r u n c o n d i t io n s w ould b e $ 5 ,2 8 6 . How­ e v e r , th e f o u r t h - y e a r y i e l d o f 1 1 .8 b u s h e ls p e r se ed ed a c re i s fo llow ed by a y i e l d o f 6 .9 b u s h e l s . T h is r e q u i r e s c a l c u l a t i n g th e fa rm u n i t n e t c a s h income from th e 1 1 .8 b u s h e l y i e l d a s t h i s income may be l e s s th a n I / An e r r o r a r i s e s when th e fa rm y i e l d i s above th e l e v e l n e ed ed to p r o v id e income t h a t w i l l be s u f f i c i e n t t o c o v e r th e c a s h ex p en se s o f th e f i rm , y e a r l y d e p r e c i a t i o n , and th e s ta n d a rd p e r s o n a l ■ d e d u c tio n s a llow ed by incom e t a x r e g u l a t i o n s . The y i e l d l e v e l r e q u i r e d t o p ro v id e t h i s amount, o f incom e i s 1 3 .1 i n th e s p r in g w hea t a r e a and 1 6 .7 b u s h e ls p e r se ed ed a c re i n th e w in t e r w heat a r e a . - 46 - t h e n e t o a sh l o s s a s s o c i a t e d w i th th e 6 .9 b u s h e l y i e l d ' t h a t f o l l o w s . - / Xn t h i s ex am p le , how ever, th e n e t c a sh incom e r e c e iv e d from an I l 0S b u s h e l y i e l d i s $ 2 ,6 7 9 which, i s h ig h e r th a n th e $1,,517 l o s s due to th e 6 .9 y i e l d . . T h is f o u r t h - y e a r income more th a n o f f s e t s th e f i f t h - y e a r l o s s and a s t h e r e a r e no y i e l d s be low th e s u r v i v a l l e v e l f o r th e rem a in d e r o f t h e s e r i e s , th e maximum r e s e r v e r e q u ir em e n t f o r t h i s y i e l d s e r i e s a t any one tim e o v e r th e 1 7 -y e a r p e r io d i s $ 5 ,2 8 6 . C a l c u la t i o n s o f t h i s ty p e w ere c om p le te d f o r e a ch y i e l d s e r i e s i n b o th a r e a s . !Jhe r e s u l t s a r e shown i n d e t a i l i n T ab le s I and I I o f A ppend ix C and summarized i n T ab le s V II and V I I I ' on page 4 7 . When th e y i e l d p e r se ed ed a c re was above 9*3 I n th e s p r in g wheat a r e a , th e i n c r e a s e i n n e t income b e fo r e income t a x e s f o r th e fa rm u n i t was $ 8 6 .6p f p r e a ch o n e - t e n th b u s h e l i n c r e a s e i n fa rm y ie ld - , a s g r o s s income i s " i n c r e a s i n g a t a c o n s ta n t r a t e a s a r e th e f i r m 's ' e x p e n se s . I n th e w in t e r w hea t a r e a , th e i n c r e a s e i n th e fa rm k n i t ' s n e t incom e b e fo r e t a x e s a s s o c i a t e d w i th a o n e - t e n th b u s h e l y i e l d i n c r e a s e above 1 0 .5 b u s h e ls i s $ 7 4 .4 0 . ; I n T a b le s V II and V I I I on page 47 th e y i e l d s e r i e s f o r e a ch a r e a a r e g rouped i n t o h ig h , m ean, and low y i e l d g r o u p s . ' The a v e ra g e y i e l d s and d o l l a r r e q u i r em e n ts f o r e a ch g roup a re g iv e n . The f i n a l column f o r 2 / Farm u n i t n e t c a s h incom e i s c a l c u l a t e d by th e f o l lo w in g s t e p s : (1 ) d e d u c t c a sh exp en se and y e a r l y d e p r e c i a t i o n from g r o s s incom e; (2 ) d e te rm in e th e amount o f income t a x p a y a b le on th e r em a in d e r ; (3 ) d e d u c t th e incom e t a x ; (4) add b a ck t h e 'd e p r e c i a t i o n c h a rg e to t h i s r e s u l t ; ( 5) s u b t r a c t th e f i x e d y e a r l y re q u irem e n t f o r th e h o u se h o ld . - U l - TABEE V I I , . „ MXIMJM RESERVES IN. DOLLARS REQUIRED. AT ANY ONE TIME FOR SUR­ VIVAL UNDER SHORT RUN. CONDITIONS. FOR EACH YIELD SERIES IN THE SPRING WHEAT..AREA. „ (FROM"TABLE I , APPENDIX C)„ : . . • - : H igh Y ib ld Group Mean Y ie ld Group Low Y ie ld Group Y ie ld Average D o l l a r Y ie ld Average D o l l a r Y ie ld A verage D o l la r S e r i e s Y i e l d • R e se rv e s S e r i e s Y ie ld . R e s e r v e s . S e r i e s Y ie ld , R e se rv e s No. Eu. ' D o l. ' No. Eu. ' P o l . No. Eu. ' D o l, I ' 1 7 .5 472 16 1 4 .0 6 ,3 4 6 7 11 .8 " 5 ,837 20 17 .3 3,436 15 1 3 .9 6,724 25 1 1 .7 9,909 9 1 7 .1 6,724 IP ■ 13,8 2 ,1 4 8 . 14 1 1 .5 4,59P 27 1 5 .7 3,296 3 13.8 5,286 13 1 1 .4 15,970 19 1 5 .1 5,384 2 13:7 4,334 . 12 11 .2 9,577 4;58826 1 5 .1 2,304 8 13:4. 4,838. 17 11 .2 21 14.9 6,724 30 13.2 6,724 11 1 1 .1 8,241 22 14.6 3,830 3,375 4 12 .8 5,g34 5' 9 .7 13 ,171 29 1 4 .5 18. ' 1 2 .4 6:724 28 8.5 11,201 • 35,5S6■ 24 1 4 .4 8 ,117 . 6' 1 1 .9 , 6f.724 . 23 6 .2 Average 15 .,6 4 ,3 6 6 13 .3 5,508 10,4. 11 ,953 TABLE V I I I . MAXIMUM RE.SERVES IN DOLLARS REQUIRED AT ANY ONE TIME FOR SUR- VIVAL UNDER SHORT HUN CONDITIONS FOR EAOH YIELD SERIES IN i THE WINTER WHEAT AREA. ' (FROM TABLE I I , APPENDIX C ) . H igh Y ie ld Groun Y ie ld A verage D o l l a r S e r i e s Y ib ld R e se rv e s Mean Y ie ld Groun Y ie ld Average D o l l a r S e r i e s Y ie ld R e se rv e s Low Y ie ld Groun Y ie ld A verage D o l la r S e r i e s Y ie ld R e se rv e s No. Eu. D o l. ' ' NqV ' ' E u / ' Dql= No. Eu. D o l. 4 ' 29.3 935 18 1 7 .2 11 ,3 10 I 13 = 4 6,621 33 2 1 .8 246 27 17 = 0 1 1 ,1 3 6 32 13=4 9,578 9 21.0 0 21 1 6 .8 5,076 36 13 = 2 4,723 17 20.9 2 ,165 34" 16.8 1 ,8 1 2 25 1 2 .8 9,832 8 2 0 .0 11 ,423 37 .. 16=4 6,765 12 12.5 11,455 ' 29 2 0 .0 ' 0 . 22 16 .3 2,944 " 26 1 1 .7 10 ,012 23 • 1 9 .7 1,402 5 16.2 2,944 ■ 10 11=6 20,350 6 19.5 4,781 . 15 . 15.8 26,552 30 11=4 14,687 31 19.0 8,351 16 15 = 5' 7,929 13 1 0 .7 12 ,039 2 1 3 .8 9,709 35 1 4 .9 4,534 . ' 19 1 0 .6 12,706. 24 1 7 .9 7,872 23 14.5 4,551 20 9.7 13 ,270 7 1 7 .8 11 ,357 3 14=4 11 ,1 4 4 11 7 .0 A l .061 14 14 . 1 . . 6,765 ■Average 2 0 .5 4,850 15 = 8. 7,959 11 .5 8,865 e a ch g roup r e c o r d s t h e maximum amount o f l i q u i d r e s e r v e s r e q u i r e d a t any­ one tim e t o i n s u r e s u r v i v a l o f th e fa rm u n i t u n d e r s h o r t run: c o n d i t io n s . I n th e s p r in g w hea t a r e a t h e r e i s o n ly one y i e l d s e r i e s t h a t r e q u i r e s more r e s e r v e s th a n th e ' d e f in e d maximum amount ($ 2 0 ,1 7 2 ) any one fa rm u n i t w ould a ttem p t t o m a in ta in ; i n th e w in te r w hea t a r e a t h e r e a r e t h r e e t h a t a r e aboye th e d e f in e d maximum amount ($ 2 0 ,2 9 5 ) The maximum l i q u i d r e s e r v e r e q u ir em e n t a t any one t im e f o r s u r v iv a l f o r th e s p r in g w hea t s e r i e s i s $35 , 550 ; t h e maximum i n th e w in t e r w heat a r e a i s $ 4 1 ,0 6 1 . ( s e e T ab le s V II and V I I l j . . The a v e rag e am ount' o f t h i s r e q u ir em e n t f o r t h e r em a in in g 29 y i e l d s e r i e s i n th e s p r in g w hea t a r e a i s $ 6 ,3 0 1 ; t h e ra n g e i s from $472 t o $ 1 5 ,9 7 0 . T h is com pares to . an av e rag e amount o f $ 7 ,0 6 0 f o r th e 34 y i e l d s e r i e s rem a in in g i n th e w in t e r w heat a r e a , th e r a n g e b e in g from $0 t o $ 1 4 ,6 8 7 . The av e rag e r e q u ir em e n t i s ■ h ig h e r and s u b je c t t o more v a r i a t i o n f o r a l l t h r e e y i e l d g ro u p s i n th e w in t e r w hea t a r e a th a n i n th e s p r in g w hea t a r e a . As shown i n T ab le V I I , i f a l i q u i d r e s e r v e i n d o l l a r te rm s e q u iv a ­ l e n t t o $ 6 ,7 2 4 (one z e ro y i e l d r e q u i r em e n t ) had b een a v a i l a b l e a t th e b e g in n in g o f th e tim e p e r io d c o n s id e r e d i n t h e s e s p r in g w hea t y i e l d s e r i e s ' , 22 o f t h e 30 w ou ld have had a d e q u a te r e s e r v e s f o r s u r v i v a l u n d e r t h e s h o r t r u n c o n d i t i o n s . F o r th e two h ig h e r y i e l d in g g ro u p s , 19 o f th e 20 w i th in t h i s a r e a w ould have had ample r e s e r v e p r o t e c t i o n . However, i n th e lo w e s t y i e l d g roup o n ly t h r e e o f th e 10 would have a d e q u a te p ro ­ t e c t i o n b e g in n in g w i th a $ 6 ,7 2 4 r e s e r v e . 3 / D e f in e d maximum am ounts d ev e lo p ed i n C h ap te r I I I . - 4 8 - - 49 - When th e o n e -y e a r r e s e r v e e q u iv a le n t a s sum p tio n i s a p p l i e d to th e w in te r -w h e a t a r e a y i e l d s e r i e s (T ab le V IH ) , o n ly I ? o f t h e 37 would have, had a d eq u a te p r o t e c t i o n f o r s u r v iv a l u n d e r s h o r t ru n c o n d i t i o n s . F i f t e e n .of th e 25 i n th e two h ig h e s t y i e l d g ro u p s w ould have ample r e s e r v e p ro ­ t e c t i o n a s w ould have o n ly two o f th e 12 i n th e l o w 'y i e l d g ro u p . I t a p p e a rs t h a t t h e r e a re two d i f f e r e n t c o n d i t io n s th a t , in f lu e n c e th e amount o f r e s e r v e s r e q u i r e d f o r s u r v i v a l . i n th e s e a r e a s . TJhe r e q u ir em e n t i n c r e a s e s a s y i e l d p e r se ed ed .a c re d e c r e a s e s and a ls o i n c r e a s e s a s th e c o e f f i c i e n t o f v a r i a t i o n i n c r e a s e s ^ However, i s o l a t e d c a s e s a re n o te d w here t h i s . does, n o t h o ld t r u e . I t i s assumed th a t , th e amount o f l i q u i d r e s e r v e s c o n s id e r e d ade­ q u a te w i l l be a v a i l a b l e t o th e fa rm u n i t a t th e b e g in n in g o f th e tim e p e r io d b e in g c o n s id e r e d . When th e n e t c a s h income o f th e fa rm u n i t i s in a d e q u a te t o c o v e r th e c a sh expen se o f th e f i rm and th e h o u seh o ld e x p e n se s , th e l i q u i d r e s e r v e w i l l be r e d u c e d by th e amount n e c e s s a ry to I ' ' ' c o v e r th e d i f f e r e n c e . I n su b seq u en t y e a r s , th e amount ta k e n from th e l i q u i d r e s e r v e w i l l be r e p l a c e d from n e t c a s h income by one- o f two m e th od s . I n th e one c a s e , any tim e t h a t n e t c a sh income i s p o s i t i v e th e s u r p lu s w i l l be t r a n s f e r r e d to th e l i q u i d r e s e r v e fu n d u n l e s s th e l i q u i d r e s e r v e f u n d - i s a t th e s p e c i f i e d maximum. I n th e a l t e r n a t i v e s i t u a t i o n , th e l i q u i d r e s e r v e fu n d w i l l be r e p a id when n e t c a sh income i s o f -a d e ­ q u a te s i z e t o r e q u i r e an incom e t a x paym en t. The n e t e f f e c t o f e i t h e r o f t h e s e m ethods w i l l be i d e n t i c a l when th e l i q u i d 'r e s e r v e i s cUsh i n - 50 - t h e bank b u t w i l l be. d i f f e r e n t when th e r e s e r v e i s h e ld a s g r a i n s to r e d . Ih e amount o f th e d i f f e r e n c e w i l l be e q u a l to th e s a v in g s due to . low er incom e t a x e s . S u r v iv a l i n th e Lnnfr Rnn W ith th e am ounts o f l i q u i d r e s e r v e s r e q u i r e d f o r s u r v i v a l u n d e r s h o r t ru n c o n d i t io n s i n m ind , th e a n a ly s i s c a n now t u r n t o th e g o a ls t h a t w ere p r e s e n te d i n C h ap te r I a s r e a l i s t i c fa rm u n i t g o a l s . S ix y i e l d s e r i e s , one from ea ch y i e l d g roup f o r e a ch a r e a , were s e l e c t e d t o d e v e lo p e s t im a t e s o f th e am ounts o f y e a r l y s u r p lu s a v a i l a b l e t o fa rm u n i t s . The amount o f y e a r l y s u r p lu s i s th e n e t c a s h income o f th e fa rm u n i t t h a t i s a v a i l a b l e f o r re p la c em e n t o f d e p r e c ia b le fa rm • u n i t i tem s and f o r in v e s tm e n t . When t h i s s u r p lu s i s a d e q u a te o v e r tim e t o r e p l a c e th e d e p r e c ia b l e i tem s th e fa rm u n i t c an s u rv iv e i n th e lo n g r u n . Any s u r p lu s a f t e r lo n g ru n s u r v i v a l i s a s s u re d w i l l be a v a i l a b l e f o r th e g o a l o f c a p i t a l a c c um u la t io n . I n th e s p r in g w hea t a r e a , y i e l d s e r i e s 19 , 3 , and 12 w ere u sed as t h e r e p r e s e n t a t i v e s o f th e h ig h , m ean, and low y i e l d g ro u p s r e s p e c t i v e ly ( s e e T ab le V I l ) . The l i q u i d r e s e r v e r e q u ir em e n t c o n s id e r e d a d eq u a te f o r s h o r t ru n s u r v i v a l f o r t h e f i r s t two s e r i e s was $ 6 ,7 2 4 ; f o r th e l a t t e r s e r i e s , $ 1 0 ,0 8 6 . R e p r e s e n ta t i v e s o f th e h ig h , m ean, and low y i e l d g ro u p s i n th e w in t e r w hea t a r e a w ere y i e l d s e r i e s 6 , 1 6 , and 19 r e s p e c t i v e l y Csee T ab le V I I I ) . The l i q u i d r e s e r v e r e q u ir em e n t c o n s id e r e d a d e q u a te f o r s h o r t ru n s u r v i v a l f o r th e two h ig h e s t y i e l d s e r i e s i n t h i s a r e a was $ 1 0 ,1 4 7 . The low y i e l d g roup s e r i e s n e e d s l i q u i d r e s e r v e s e q u a l to $ 1 3 ,5 3 0 . These d o l l a r am ounts o f r e s e r v e s a r e assumed t o b e a v a i l a b l e a t th e b e g in n in g o f t h e tim e p e r io d b e in g c o n s id e r e d . - 5 1 - T ab le s I I I th ro u g h V I I I i n A ppendix C show th e y e a r l y s u r p lu s f o r e a ch o f t h e s e y i e l d s e r i e s . The fa rm u n i t n e t c a sh income and y e a r ly s u r p lu s a r e c a l c u l a t e d by t h r e e d i f f e r e n t m e thod s : ( l ) th e r e s e r v e i s h e ld a s c a s h i n th e b ank ; (2 ) th e r e s e r v e i s h e ld a s g r a i n i n s to r a g e w i th r a p i d r e p la c em e n t (any d e f i c i t i s r e p l a c e d when n e t c a s h income i s a p o s i t i v e am oun t); and (3 ) th e r e s e r v e i s h e ld a s g r a i n i n s to r a g e w i th r e p la c em e n t o n ly f ro m .h ig h y i e l d y e a r s . Two a d d i t i o n a l y e a r s (1957 and 1958) o f y i e l d d a ta w ere made a v a i l a b l e a t t h i s s ta g e o f d eve lopm en t f o r e a ch o f th e s e s e r i e s and h a s b een in c lu d e d f o r th e c a l c u l a t i o n o f y e a r l y s u r p lu s . W ith t h i s e x c e p t io n , t h e s e y i e l d s e r i e s a r e th o s e p r e s e n te d i n T ab le s I and I I o f Appendix A. •The c um u la tiv e v a lu e o f th e y e a r l y s u r p lu s d e te rm in e d by; th e c a l c u l a t i o n s c om p le te d i n T a b le s I I I th ro u g h V I I I i n A ppend ix C a re p r e s e n te d a s T ab le IX on page 52 . The v a lu e o f th e a s s e t s owned by th e fa rm u n i t a t th e b e g in n in g o f t h e p e r io d was $ 1 5 ,7 5 0 f o r m ach in e ry and equ ipm en t and $ 9 ,2 5 0 f o r b u i ld i n g s and h o u se h o ld equ ipm en t i n th e s p r in g w heat a r e a . The y e a r l y d e p r e c i a t i o n c h a rg e f o r t h e s e i tem s was $ 3 ,3 0 5 i n t h i s a r e a , $ 2 ,4 75 f o r m ach in e ry and e q u ipm en t, and $830 f o r b u i ld i n g s and h o u se h o ld equ ipm en t. I n t h e w in te r w hea t a r e a th e b e g in n in g v a lu e o f th e m ach in e ry and equ ipm en t was $20 , 500 ; t h e h o u seh o ld equ ipm en t and b u i ld i n g s w ere v a lu e d a t $ 1 0 ,0 0 0 . The y e a r l y d e p r e c i a t i o n c h a rg e t o t a l e d $ 4 ,0 6 7 , $ 3 ,2 0 7 f o r m ach in e ry and e q u ipm en t, $860 f o r b u i ld i n g s and h o u seh o ld equ ipm en t. The t o t a l c h a rg e f o r d e p r e c i a t i o n f o r th e p e r io d o f t im e c o n s id e re d f o r e a ch s e r i e s was c a l c u l a t e d by two d i f f e r e n t m e thod s: ( l ) i t was assum ed t h a t th e v a lu e o f th e owned i tem s w ould have.,, i f p o s s i b l e , th e - 5 2 - TABLE IX . CTJMJLATIVB YEARLY SURPLUS AVAILABLE FOR LONG RUN SURVIVAL AND . CAPITAL ACCUMULATION WHEN RESERVES ARE MANAGED AS CASH IN THE . BANK, GRAIN STORED AND REPLACED RAPIDLY, AND GRtAlN STORED AND REPLACED ONLY IN HIGH YIELD YEARS, FOR THE TffRFF SELECTED ' YIELD SERIES IN EACH OF THE TWO STUDY ARFAF, ' A rea Y ie ld S e r ie s , Cash i n Bank G ra in R ep laced ■ R a p id ly G ra in R ep laced from H igh Y ie ld s Np. D p i. . . . • ■ P o l . M . S p r in g Wheats S e r i e s 19 83,#30 84 ,4 51 85,710 S e r i e s 3 67,679 .68 ,620 ' 7 0 ,8 6 8 S e r i e s 12 49,973 53 ,017 55 ,720 W in te r Wheats S e r i e s 6 150 ,412 150 ,772 151 ,776 S e r ie s 16 72,939 74,952 76,7.80 S e r i e s 19 15,794 18 ,462 . . 26,,984 . , I - - T •" «"■ ' ; • ~ __ . 1" ■ niJ ^ ^ ~ ^ ^ T ~ 11111 n n " ‘^ ^ ^ I - same v a lu e a t th e end o f th e tim e p e r io d a s a t th e b e g in n in g ; and (2 ) th e e n d in g in v e n to r y w ould a llo w fo r . c om p le te d e p r e c i a t i o n o f th e m ach in ery and equ ipm en t; o n ly th e b u i ld i n g s and h o u se h o ld equ ipm en t w ould have th e b e g in n in g in v e n to r y v a lu e . T h is l a t t e r a s sum p tio n i s c o n s id e r e d a r e a l i t y f o r th e fa rm u n i t t h a t p l a n s r e t i r e m e n t a t th e end o f th e tim e p e r io d . The t o t a l d e p r e c i a t i o n c h a rg e f o r e ach y i e l d s e r i e s i s p r e s e n t e d i n T ab le X on page 53 . The d o l l a r d i f f e r e n c e s w i th in th e same a r e a a re due t o th e number o f y e a r s o f d a ta th e s e r i e s c o n ta in . When th e a g g re g a te amounts o f n e t s u r p lu s from T ab le IX a re com­ p a re d t o th e t o t a l d e p r e c i a t i o n c h a rg e i n T ab le X i t a p p e a r s t h a t lo n g ru n s u r v i v a l i s a s s u r e d f o r y i e l d s e r i e s 19 and t h r e e i n th e s p r in g w hea t a r e a and s e r i e s s i x i n th e w in t e r w hea t a r e a . S e r i e s 16 i n th e w in t e r w hea t a r e a w ould a p p e a r t o be a t th e m a rg in , w h ile i t seems y i e l d - 53 - Seri0S 12 in the spring wheat area and 19 in the winter wheat area would be unable to survive in the long run. TABLE X. CUMILATIVE DEPRECIATION CHARGE TO MAINTAIN COMPLETE INVENTORY AND TO DEPRECIATE. OUT EQUIPMENT AT END OF PERIOD FOR THRFF SELECTED YIELD SERIES IN EACH STUDY AREA. Y ie ld D e p r e c ia t io n O b ie c tnva A rea S e r i e s M a in te n an c e ^ / D e p r e c ia te d Outitf - . I o . S o l . -Dol, S p r in g W heat; S e r i e s 19 62,795 47 ,045 S e r i e s 3 62,795 47 ,045 S e r i e s 12 69,405 53,655 W in te r Wheats S e r i e s 6 89,474 68,974 S e r i e s 16 85,407 64,907 S e r i e s 19 77 ,273 56,773 D / A f u l l d e p r e c i a t i o n c h a rg e i s made e a ch y e a r . b / Only th e d e p r e c i a t i o n c h a rg e f o r b u i ld i n g s and h o u se h o ld equ ipm en t i s made i n th e l a t e r y e a r s . To o b ta in a c l o s e r e s t im a te o f th e a b i l i t y o f t h e s e 'f a rm u n i t s to s u rv iv e i n th e lo n g ru n th e y e a r l y s u r p lu s amounts w ere s u b je c te d to a d d i t i o n a l c a l c u l a t i o n . By s u b t r a c t i n g th e d o l l a r amount o f d e p r e c ia t io n from th e y e a r l y . s u r p lu s f o r e a ch y e a r th e c a p i t a l a v a i l a b l e f o r c a p i t a l a c c um u la t io n i s i s o l a t e d , . The amount o f t h i s r e s i d u a l g iv e s an i n d i ­ c a t i o n o f th e fa rm u n i t ' s a b i l i t y to s u rv iv e a s w e l l a s A ccum ulate c a p i t a l . A no th e r m ethod o f e s t im a t in g th e a b i l i t y o f th e fa rm u n i t to s u rv iv e i n th e lo n g ru n i s by v i s u a l i n s p e c t i o n o f th e y e a r l y s u rp lu s co lum ns i n T ab le s I I I th ro u g h VTII o f A ppend ix C. Whpn f o r a p e r io d o f c o n s e c u t iv e y e a r s t h e r e i s no y e a r l y s u r p lu s , th e fa rm u n i t w i l l n o t s u r v i v e „ The number o f su ch y e a r s t h a t th e u n i t can s ta n d w i l l v a ry - 54 - ■with m anagem ent, a t l e a s t t o some d e g r e e „ A lth ough d e p r e c i a t i o n i s •w r i t te n o f f a s a y e a r l y exp en se f o r incom e t a x c o m p u ta t io n s , ' i t seems t h a t th e r e p la c em e n t o f d e p r e c ia b le i tem s i s n o rm a lly a f u n c t i o n o f th e fa rm u n i t n e t c a sh in com e. I f t h i s w ould n o t be t r u e v e ry few fa rm u n i t s w ould s u rv iv e i n th e lo n g r u n , a s i n d i c a t e d by th e v a r i a t i o n in. ■yearly s u r p lu s f o r t h e s e s i x y i e l d s e r i e s . T ab le s IX th ro u g h XIV summa r i z e th e y e a r—to —y e a r income p o s i t i o n s o f t h e s e s i x fa rm u n i t s . The y e a r l y s u rp lu s , amounts i n t h e s e t a b l e s w ere ta k e n from th e l a s t co lum ns o f T ab le s I I I th ro u g h V I I I o f Appear . d ix Co' T h is th e n , i s t h e y eg tr ly s u r p lu s when the. l i q u i d r e s e r v e i s h e ld . 0 a s s to r e d g r a i n and any r e p la c em e n ts a re made o n ly when th e y i e l d s a re a d e q u a te t o r e q u i r e an incom e t a x paym ent i f th e g r a i n w ere s o ld . The n e t w o r th o f t h e s e fa rm u n i t s , th e v a lu e o f th e l i q u i d r e s e r v e p lu s t h e v a lu e o f th e d e p r e c ia b l e i tem s owned by th e fa rm u n i t p l u s th e cumu­ l a t i v e s u r p l u s . f o r in v e s tm e n t , a re g iv e n i n t h e s e t a b l e s f o r th e b e g in ­ n in g o f th e tim e p e r i o d , e a ch y e a r o f t h e tim e p e r i o d , . and a t th e end o f th e t im e p e r io d . T h is n e t w o r th i s g r a p h i c a l l y p r e s e n te d i n F ig u re s 8 and 9 on th e f o l lo w in g p a g e s . T h is w ould b e th e n e t w o r th o f t h e fa rm u n i t i f th e s u rp lu s f o r in v e s tm e n t w ere h e ld a t a z e ro r a t e o f i n t e r e s t . The n e t w o r th o f a fa rm u n i t r e p r e s e n t e d by y i e l d s e r i e s 12 i n th e s p r in g w hea t a r e a i s a t i t s h ig h e s t v a lu e a t t h e 'b e g in n in g o f th e tim e p e r i o d . ( s e e F ig u re 8 ) . ,A t th e end o f th e tw e l f t h y e a r th e n e t w o r th o f t h i s u n i t was $ 2 ,0 5 4 , a d e c re a s e o f $33 ,0 32 from th e b e g in n in g i n v e n to r y . When a f u l l d e p r e c i a t i o n c h a rg e i s d e d u c te d from th e y e a r l y s u r p lu s f o r t h i s u n i t t h e r e i s a t no tim e a s u rp lu s f o r in v e s tm e n t . - 55 - N e t W 0 r t h 1 n T h o u S a n d s Y ie ld T— S e r i e s 19 Y ie ld S e r i e s 3 Y ie ld S e r i e s 12 Y ea rs F ig u re 8 . Y e a r - to - y e a r N et W orth f o r th e Three S e le c te d Y ie ld S e r ie s i n th e S p r in g Wheat A rea . t h e r e f o r e , no ch an ce f o r c a p i t a l a c c um u la t io n . T h is f i rm would be u n a b le to p ro v id e a d eq u a te r e s e r v e s n e c e s s a ry f o r lo n g ru n s u r v iv a l and even w i th r e s e r v e s p ro v id e d by i n s t i t u t i o n s , su ch a s in s u r a n c e and f e r t i l i z e r s , s u r v iv a l i s e x trem e ly d o u b t f u l . I t would a p p e a r t h a t a fa rm u n i t w i th y i e l d e x p e r ie n c e o f t h i s ty p e h a s o n ly th e a l t e r n a t i v e o f i n c r e a s i n g s i z e f o r s u r v i v a l , assum ing econom ies o f s c a l e do e x i s t . A lth ough th e n e t w o rth o f a fa rm u n i t r e p r e s e n te d by y i e l d s e r i e s t h r e e i n th e s p r in g w hea t a r e a i s o n ly $ 1 1 ,0 3 4 a t th e end o f 10 y e a r s i t i s assumed t h a t t h i s u n i t c o u ld s u rv iv e w i th some r e l i a n c e upon r e s e r v e s p ro v id e d by i n s t i t u t i o n s . I t seems a fa rm u n i t t h a t e x p e r ie n c e s y i e l d s a s th o s e o f y i e l d s e r i e s 19 i n t h i s a r e a c o u ld ( X t3 ( B D 3 f 3 0 C r » - 3 D H* PT C + *-J ~ 56 ~ Y ie ld S e r i e s 6 Y ie ld S e r i e s 16 Y ea rs Y ie ld S e r i e s 19 F ig u re 9 . Y e a r - to - y e a r N et W orth f o r th e T hree S e le c te d Y ie ld S e r ie s i n th e W in ter- Wheat A rea . - 5 7 - p ro v id e a d eq u a te p r o t e c t i o n f o r s u r v i v a l i n th e lo n g r u n -w ithou t r e l y i n g upon r e s e r v e s from n o n - u n i t s o u rc e s . The s u rp lu s f o r in v e s tm e n t f o r t h i s fa rm u n i t i s $ 2 9 ,8 7 2 . D e c is io n s c o n c e rn in g th e a b i l i t y o f th e fa rm u n i t s i n th e w in te r w hea t a r e a t o s u rv iv e i n th e lo n g ru n u n d e r th e g iv e n a s sum p tio n s c a n be made q u i t e e a s i l y ( s e e F ig u re 9 ) . There w ould b e no ch ance f o r s u r v i v a l o f t h e fa rm u n i t r e p r e s e n t e d by y i e l d s e r i e s 19 ; th e fa rm u n i t r e p r e s e n te d by y i e l d s e r i e s 16 c o u ld s u rv iv e w i th r a t h e r heavy r e l i a n c e upon r e s e r v e s p ro v id e d by i n s t i t u t i o n s i f th e s u rp lu s f o r in v e s tm e n t w ere w is e ly i n v e s t e d . The fa rm u n i t r e p r e s e n te d by y i e l d s e r i e s s i x c o u ld q u i t e e a s i l y s u rv iv e a s w e l l a s a ccum u la te c a p i t a l . C a p i t a l A ccum u la tion The d o l l a r am ounts o f n e t c a s h incom e t h a t a re a v a i l a b l e f o r c a p i t a l a c c um u la t io n by y e a r s a r e i s o l a t e d f o r e a ch y i e l d s e r i e s i n T ab le s IX th ro u g h XIV o f A ppend ix C and a r e i d e n t i f i e d by th e co lum ns e n t i t l e d s u r p lu s f o r in v e s tm e n t , As s t a t e d i n th e p r e c e d in g s e c t i o n , th e amounts o f y e a r l y s u rp lu s a c cum u la te d u n d e r th e g r a i n s to r a g e l i q u i d r e s e r v e w i th r e p la c em e n t on h ig h y i e l d i n g y e a r s was u s e d . The incom e t a x advan­ ta g e a c c ru in g o v e r t im e from t h i s m ethod ra n g e d from a h ig h o f $ 5 ,747 ( y i e l d s e r i e s 1 2 , s p r in g w hea t a r e a ) t o a low o f $ 1 ,3 6 1 ( y i e l d s e r i e s s i x . W in te r w hea t a r e a ) . The ad .vantage i s th e g r e a t e s t when th e v a r i a t i o n i n incom e is - h ig h , w h ich i s a f u n c t i o n o f y i e l d s = The u s in g o f th e y e a r l y s u rp lu s a c cum u la ted u n d e r t h i s fo rm o f g r a i n r e s e r v e s r e q u i r e s th e a ssum p tio n t h a t th e income t a x s a v in g s a re g r e a t enough t o o f f s e t s to r a g e c o s t s a s s o c i a t e d w ith th e g r a i n . The s u rp lu s , f o r in v e s tm e n t , c a l c u l a t e d u n d e r th e a s sum p tio n s d i s ­ c u s s e d u n d e r s u r v i v a l i n th e lo n g r u n , was assumed t o be i n v e s t e d a t v a r i o u s r a t e s o f i n t e r e s t . O ther a s sum p tio n s a s s o c i a te d w i th th e s e c a l c u l a t i o n s w ere t h a t th e in v e s tm e n ts w ould b e made a t a p p ro x im a te ly th e same d a te e a ch i n v e s t i n g y e a r and t h a t th e i n t e r e s t ( o r d iv id e n d ) w ould be r e i n v e s t e d on t h i s same d a te . The i n t e r e s t was compounded a n n u a l ly . The v a lu e o f t h e s e in v e s tm e n ts a t th e ehd o f th e tim e p e r io d c o n s id e r e d a r e summarized i n T ab le X I on page 59 . The number and am ounts o f in v e s tm e n ts by y e a r s a re from th e s u rp lu s f o r i n v e s t ­ m ent colum n o f T ab le s IX , X, X I I , and X I I I o f A ppendix C. An i n d i c a t i o n o f th e im p o r ta n c e o f th e tim e when in v e s tm e n ts can b e made i s in c lu d e d i n T ab le X I. Compare, i n th e 6 p e r c e n t r a t e o f i n t e r e s t co lum n ,, th e d o l l a r g row th due t o i n t e r e s t a c c um u la t io n s i n y i e l d s e r i e s s i x and 19 . The v a lu e o f th e in v e s tm e n t a t th e z e ro r a t e o f i n t e r e s t , (summ ation o f th e s u r p lu s f o r in v e s tm e n t) f o r y i e l d s e r i e s 19 i n th e p a r t i a l v a lu e row i s $ 3 9 ,9 9 4 and t h i s grow s t o a $ 7 1 ,2 3 8 v a lu e when in v e s t e d a t 6 p e r c e n t . T h is i n c r e a s e i s $ 3 1 ,2 2 4 , The v a lu e o f th e . s u r p lu s f o r in v e s tm e n t f o r y i e l d s e r i e s s i x u n d e r th e p a r t i a l v a lu e row i s $ 8 2 ,8 0 2 and t h i s grow s t o a $ 106 ,966 v a lu e when in v e s t e d a t 6 p e r c e n t . The d o l l a r d i f f e r e n c e i n t h i s c a s e i s $ 2 4 ,1 6 4 . T h is i s s i g n i f i c a n t l y d i f f e r e n t th a n th e $ 3 1 ,2 2 4 g row th f o r th e y i e l d - 59 - s e r i e s 19 e a s e , and i s due t o th e tim e th e in v e s tm e n ts w ere made a s oan b e se en i n th e a p p l i c a b l e t a b l e i n A ppendix C„ TABLE XI. DOLLAR VALUE OF THE SURPLUS FOR INVESTMENT AT THE END CF THE TIME PERIOD WHEN INVESTED AT VARIOUS RATES QF INTEREST FOR' TWO SELECTED YIELD SERIES IN EACH STUDY AREA. A rea Y ie ld S e r i e s D e p r e c ia t io n O b ie c tiv e 0$ R ate o f I n t e r e s t 3% 4% 5* 6# S p r in g W heat; P o l . P o l . D o l8 D o l. D o l. S e r i e s '19: M ain tenanc e S / D e p r . Outiv 29,872 39,994 41,506 52,810 46,498 58,218 52,182 64,332 58,645 71,238 S e r i e s 3 : M a in te n an c e ^ / D e p r . Out—/ 11,965 23,823 15,324 28,148 16,727 29,884 18,306 31,804 20,075 33,922 W in te r Wheats S e r ie s 6: M a in te n an c e ^ / D ep r . Out—/ 62,302 82,802 71,414 93,661 74,929 97,794 78,723 102,221 82,811 106 ,966 S e r ie s . 16; M a in te n an c e ^ / D ep r . Out—/ 9,143 11 ,873 13 ,831 1 6 ,5 61 15,834 18,564 18,102 20,832 20,671 23 ,4 01 -S/ A f u l l d e p r e c i a t i o n c h a rg e i s made e a ch y e a r . b / Only th e d e p r e c i a t i o n c h a rg e f o r b u i ld i n g s and h o u s e h o ld . equ ipm en t i s made i n th e l a t t e r y e a r s . To i l l u s t r a t e th e a b i l i t y o f c a p i t a l to accum u la te i n a n o th e r m anner y i e l d s e r i e s s i x was r e v e r s e d i n o r d e r . The y i e l d e x p e r ie n c e r e c o rd e d f o r th e l a s t y e a r o f d a t a was. assumed to be th e f i r s t y e a r o f e x p e r ie n c e . The y e a r l y s u r p lu s , th e y e a r l y s u r p lu s f o r in v e s tm e n t , and th e accu-^ m u la t iv e v a lu e o f . t h i s s u r p lu s when i n v e s t e d a t a 6 p e r c e n t r a t e o f i n t e r e s t when t h i s s e r i e s i s r e v e r s e d i s p r e s e n te d on page 6.0 a s T ab le X I I . — 60 — TABLE X II.. YEARLY SURPLUS, YEARLY SURPLUS FOR INVESTMENT, AND THE CUMU- " LATIVE VALUE QF THIS SURPLUS WHEN INVESTED AT A 6 PERCENT RA-TE OF INTEREST, YIELD SERIES SIX REVERSED, WINTER WHEAT AREA. ' Y e a r ly S u rp lu s f o r V alue o f Y ea r S u rn lu s In v e s tm e n t In v e s tm en t D o l. D o l. P o l . I 1 4 ,6 0 1 10,534 10 ,534 2 15,909 11 ,8 4 2 23 ,008 3 9,497 5,43P 29,818 4 4,974 907 32,514 5 1 6 ,1 1 6 . 12,049 46,514 6 7,824 3., 757 53,062 7 . 5,583 1,516 5.7,762 8 . 7,757 3,690 64 ,918 ■ 9 2,929 0 68 ,813 10 6,970 1 ,765 74 ,707 11 10 ,743 6 ,6 7 6 85,865 12 3,675 0 . 91 ,017 13 2 ,6 0 1 0 - 96,478 14 10,090 4,165 106 ,432 15 5,691 1 ,624 114,442 16 6,480 2 ,413 123 ,722 17 1 0 ,5 0 6 6,439 137,584 18 4,607 540 146,379 19 0 0 - 155,162 20 616 • 0 ■ . 164 ,472 21 4,60? 0 - 174 ,340 22 '0 0 184 ,800 The v a lu e o f th e in v e s tm e n t u n d e r th e i d e n t i c a l a s sum p tio n s , when t h e y i e l d s e r i e s was a s e x p e r ie n c e d , a t th e end o f th e 22 f-year p e r io d was $ 8 2 ,8 1 1 (T ab le IV , y i e l d s e r i e s s i x , f u l l v a lu e ) . The o r d e r o f th e y i e l d e x p e r ie n c e , o r th e t im e when th e in v e s tm e n ts w ere m ade, r e s u l t e d i h an i n c r e a s e d v a lu e o f $ 101 ,989 o v e r t h e 2 2 -y e a r p e r io d when t h i s y i e l d s e r i e s was r e v e r s e d . T h is s h o u ld amply i l l u s t r a t e th e a d v an ta g e o f r e s e r v e s u s e d t o a c cum u la te c a p i t a l . CHAPTER V SUEMARZ AND CONCLUSIONS. Siiinmary R isk s and u n c e r t a i n t i e s a r i s i n g from v a r i a b l e o u tp u t a re b a s ic to t h i s s tu d y 6 E r r a t i c p r o d u c t io n , a s e x p e r ie n c e d i n d r y la n d a r e a s o f th e G re a t P la in s , b r in g s f o r t h ex trem e v a r i a t i o n i n th e f a rm e r ’ s incom e. I t i s assum ed t h a t th e g o a ls o f th e fa rm u n i t ( f i rm and h o u se h o ld ) a re s u r v i v a l o f th e u n i t o v e r t im e and th e n c a p i t a l a c c um u la t io n . The h y p o th e s e s o f th e s tu d y a r e t h a t th e fa rm u n i t o p e r a t in g w i t h in th e s e c o n d i t i o n s c a n u s e f i n a n c i a l and p h y s i c a l r e s e r v e s i n th e e f f o r t s to a t t a i n t h e s e g o a ls . S p e c i f i c a l l y , r e s e r v e s w i l l h a s te n t h e a t ta in m e n t o f t h e g o a ls and f o r e a ch fa rm u n i t t h e r e w i l l bp an optimum r e s e r v e u se p a t t e r n f o r g o a l r e a l i z a t i o n . Y ie ld d a t a s p e c i f i c t o i d e n t i f i a b l e t r a c t s o f la n d w ere l o c a t e d . A l l u s a b le s e r i e s f o r th e J u d i t h B a s in and R o o se v e lt and S h e r id a n c o u n t i e s w ere s e l e c t e d p r o v id in g 37 s e r i e s f o r th e fo rm e r and 30 f o r th e n o r th e a s t c o u n t i e s . From th e s e s e r i e s , y i e l d v a r i a b i l i t y a s e x p e r ie n c e d by th e i n d i v i d u a l was d e s c r ib e d . D i f f e r e n c e s i n y i e l d , and th e v a r i a b i l i t y a s s o c i a t e d w i th t h e s e d i f f e r e n c e s w ere d e s c r ib e d f o r th e . two w hea t- p ro d u c in g a r e a s . I n th e n o r t h e a s t a r e a t h e c o e f f i c i e n t o f v a r i a t i o n f o r i n d i v i d u a l y i e l d s e r i e s r a n g e d from 3 6 .0 t o 6 6 .1 p e r c e n t , i n t h e J u d i t h B a s in from 2 3 .3 t o 6 0 .4 p e r c e n t . The n e t c a s h incom e r e q u i r em e n ts f o r s h o r t ru n s u r v i v a l when y i e l d s w ere b e low th e b re a k e v e n p o in t w ere c a l c u l a t e d . The l i q u i d r e s e r v e r e q u i r em e n ts f o r s h o r t r u n s u r v iv a l o f t h e fa rm u n i t a t f o u r s e l e c t e d - 62 - y ie ld , l e v e l s a t and be low th e b re a k e v e n p o in t i n e a ch a r e a w ere d e te rm in e d . E ve ry p o s s ib l e t h r e e - y e a r c om b in a tio n o f t h e s e f o u r y i e l d l e v e l s w ere t e s t e d t o d em o n s tra te t o t a l s h o r t ru n s u r v i v a l r e q u i r em e n ts . I n b o th a r e a s th e maximum Was a l i t t l e o v e r $ 2 0 ,0 0 0 . ' F o r e a ch y i e l d s e r i e s , th e l i q u i d r e s e r v e r e q u i r em e n ts a t any one tim e f o r s h o r t ru n s u r v i v a l w ere c a l c u l a t e d . These r e q u i r em e n ts r a n g e d from $472 to $35,550 i n th e n o r t h e a s t a r e a ; from $0 t o $ 4 1 ,0 6 1 i n th e o th e r a r e a . I n e a ch a r e a t h r e e y i e l d s e r i e s r e p r e s e n t i n g h ig h , medium, and low mean y i e l d l e v e l s w ere s e l e c t e d . The y e a r l y s u r p lu s n e t c a s h income a v a i l a b l e f o r lo n g ru n s u r v i v a l and c a p i t a l a c cum u la tio n f o r e a ch s e r i e s was d e te rm in e d . W hile i n a l l c a s e s t h e r e would be s u r p lu s above s h o r t r u n s u r v i v a l r e q u i r em e n ts , i n th e lo n g r u n th e s e r i e s w i th t h e low e s t mean y i e l d l e v e l i n e a ch a r e a c o u ld n o t s u r v iv e . F o r th e r em a in in g f o u r y i e l d s e r i e s , t h e s u rp lu s n e t c a s h income f o r c a p i t a l a c c um u la t io n was i s o l a t e d . T h is s u r p lu s was assum ed to be h e ld a s a l i q u i d r e s e r v e { z e ro r a t e o f i n t e r e s t ) and in v e s t e d a t r a t e s o f i n t e r e s t r a n g in g from 3 t o 6 p e r c e n t . W henever a s u r p lu s c an be i n v e s t e d e a r l y i n a t im e s e r i e s , a r e s e r v e b u i l d s up t h a t c a n p r o t e c t t h e fa rm u n i t a g a in s t any no rm a l demands on income t h a t a r i s e i n th e s e s e r i e s . When low y i e l d s a r e e x p e r ie n c e d a t t h e b e g in n in g o f a manage­ m ent t im e p e r io d i t i s d i f f i c u l t to p r o v id e p r o t e c t i o n th ro u g h th e u se o f r e s e r v e s b u t two h ig h , o r even one e x trem e ly 'h i g h , y i e l d y e a r s a t th e b e g in n in g o f. th e p e r io d c a n a s s u r e s h o r t r u n s u r v iv a l u n d e r a lm o s t any c i r c u m s ta n c e s and p ro v id e a d eq u a te c a p i t a l a c c um u la t io n . - 63 - C o n c lu s io n s As in fo rm a t io n c o n c e rn in g r e s e r v e s and. t h e i r u s e s was d e v e lo p e d , i t became a p p a re n t t h a t r e s e r v e s , a s d e f in e d , w ould be u se d f o r two d i s t i n c t p u rp o s e s . L iq u id r e s e r v e s c an have a s t h e i r o n ly r e a s o n a b le p u rp o se th e i n s u r i n g o f s u r v i v a l i n th e s h o r t r u n . R e se rv e s o f a some­ w hat l e s s l i q u i d fo rm have a s t h e i r m a jo r p u rp o se th e a c cum u la tio n o f c a p i t a l . They a re a l s o c a p a b le o f i n s u r i n g o r p a r t i a l l y i n s u r i n g lo n g ru n s u r v i v a l o f th e fa rm u n i t , and f i n a l l y , c an s e rv e a s a b a s i s f o r c r e d i t n eed ed i n t h e s h o r t r u n i n p la c e o f l i q u i d r e s e r v e s . A fa rm u n i t o f a d e q u a te s i z e can u s e r e s e r v e s t o a l l e v i a t e th e p ro b lem s o f m anagement, c a p i t a l , and incom e i n th e e f f o r t s o f f a rm e rs to a t t a i n t h e i r g o a l s . I n fo rm a t io n d e v e lo p ed th ro u g h o u t th e s tu d y s u p p o r ts t h i s h y p o th e s i s , w i t h in th e scope o f th e s tu d y . I t became a p p a re n t when in v e s tm e n t a l t e r n a t i v e s w ere c a l c u l a t e d t h a t th e i n d i v i d u a l , o r fa rm u n i t , who i n t e l l i g e n t l y m anages r e s e r v e s c o u ld e x p e c t t o a t t a i n econom ic s u c c e s s b e fo r e one who do es n o t u s e r e s e r v e s . When v a r io u s y i e l d s e r i e s w ere a n a ly z e d t o d e te rm in e s h o r t ru n s u r v i v a l , , i t was fo u n d t h a t th e r e i s an optimum r e s e r v e u s e p a t t e r n s p e c i f i c to e a ch s e r i e s . These r e s u l t s te n d t o v e r i f y th e s p e c i f i c h y p o th e s e s . Im p l ic a t i o n s The y i e l d s e r i e s t h a t w ere a v a i l a b l e b eg an i n th e l a t e 1 9 3 0 's and y i e l d s w ere low i n t h e f i r s t few y e a r s . T h is o n ly em phas ized th e h a z a rd s o f a fa rm b u s in e s s a t tem p t in g t o become e s t a b l i s h e d . D u rin g th e e a r l y y e a r s th e f i rm i s n o rm a lly i n a v u ln e r a b le p o s i t i o n , m a in ly b e c a u s e o f c a p i t a l l im i t a t i o n s . I t a p p e a r s th e n t h a t m ea su re s t o i n s u r e s t a b l e incom e a re o f g r e a t e s t im p o r ta n c e a t t h i s t im e — h a i l , a l l ­ r is k - , o r d th 6 r" in s u r a n c e c o h ld be c r i t i c a l : „Whenever t t e c a p i t a l p o s i t i o n i s im p roved t o th e p o in t w here t h e r e i s a s i g n i f i c a n t s u rp lu s t h a t c a n b e i n v e s t e d th e n th e in v e s tm e n t c a n p ro v id e th e n e c e s s a ry f i n a n c i a l s u p p o r t . Of c o u r s e , any s u r p lu s t h a t i s a l r e a d y comm itted i n t h e fo rm o f in d e b te d n e s s w i l l d e la y th e a c cum u la tio n o f a r e s e r v e „ The im p o r ta n c e o f t h e f i r s t few y e a r s i n a management s e r i e s i s a l s o a p p a r e n t . I f th e y b r in g low y i e l d s t h e management p ro b lem i s d i f f i c u l t and th e f i n a n c i a l c o n d i t io n h a z a rd o u s . I f th e y h appen to be f a v o r a b le t h e o p p o r tu n i ty to e s t a b l i s h a r e s e r v e i s a t h an d , and once e s t a b l i s h e d a t a l e v e l a p p r o p r i a t e t o t h e fa rm u n i t , th e p r o b a b i l i t y o f s u r v i v a l and c a p i t a l a c c u m u la t io n :i s h ig h . I n e i t h e r c a s e , t h e u se o f incom e t o e s t a b l i s h r e s e r v e s a t an e a r l y .d a te sh o u ld have h ig h p r i o r i t y i n c o m p e t i t io n w i th d e s i r e s t o i n c r e a s e l e v e l o f l i v i n g and o th e r a l t e r n a t i v e s . Management o f r e s e r v e s , c a n n o t b e s e p a r a te d from c r e d i t , e x c e p t i n t h e c a s e o f l i q u i d r e s e r v e s h e ld i n l im i t e d amounts f o r s h o r t r u n s u rv iv a l= The m ech an ic s o f I n v e s tm e n t s , i n c l u d i n g . s e l e c t i o n , p u rc h a s e , and s a l e o f in s t r u m e n ts o r t i t l e s , paym ent o f d iv id e n d s and e a r n in g s , and so on , s u g g e s t t h a t c o n t r o l o f incom e t o th e fa rm u n i t c a n be m anaged m ost e f f e c t i v e l y th ro u g h c r e d i t b a s e d on th e r e s e r v e r a t h e r th a n by c o n t i n u a l l y c o n v e r t in g when n eed ed and r e i n v e s t i n g when t h e s u rp lu s a g a in becomes a v a i l a b l e . - 64 ~ - 65 ~ Im p l ic a t i o n s a r e d i f f i c u l t t o d e v e lo p w i th r e s p e c t t o th e v a r i e t i e s o f fa rm s i z e s and t e n u r e sy s tem s and y i e l d l e v e l s t h a t w ere n o t e x p lo re d . The s i z e u se d a s th e exam ple i n t h i s s tu d y was s e le c t e d b e c au se i t was e x p e c te d t o haye i n h e r e n t s u r v i v a l c a p a b i l i t i e s , a t l e a s t w i th mean a v e ra g e y i e l d s . A p r i o r i sm a l le r fa rm s w ould be e x p e c te d t o have d i f f i ­ c u l t y e x c e p t w i th v e ry h ig h y i e l d s , apd l a r g e r fa rm s s h o u ld b e a b le to p r o v id e f o r t h e f a rm e r s * g o a ls w i th somewhat low e r mean y i e l d s . The p o s s i b i l i t y o f s u r v i v a l and c a p i t a l a c cum u la tio n i n r e l a t i o n to t h e y i e l d v a r i a b i l i t y and mean y i e l d l e v e l o f a g iv e n fa rm h a s im p o r ta n t im p l i c a t i o n s w i th r e s p e c t t o th e v a lu e o f th e fa rm and th e fo rm o f t e n u r e u n d e r w h ich th e fa rm i s . o p e r a te d . I t may be p o s s ib l e t o demon­ s t r a t e a g iv e n c a p i t a l i z e d v a lu e w h ich , u n d e r some a d v e rs e v a lu e s o f s i z e , v a r i a b i l i t y , o r p r o d u c t i v i t y would even be n e g a t iv e . The same la n d u s e d a s an in c rem en t (owned o r r e n t e d ) t o a n o th e r fa rm may have a h ig h v a lu e . F u tu re R e se a rc h F a rm e rs r e a l i z e t h a t i t i s more d i f f i c u l t to b r e a k new g round th a n t o spend tim e w o rk in g w i th sm oo th e r, p r e v io u s ly - b ro k e n g ro u n d ; how ever, t h e work a s s o c i a te d w i th b re a k .n ew g round te n d s t o be a more s a t i s f y i n g a s w e l l a s a more p r o d u c t iv e l a b o r . T h is a n a lo g y a p p l i e s t o t h i s r e s e a r c h e f f o r t . I n th e g round ­ b r e a k in g p r o c e s s t h e t o o l s a v a i l a b l e w ere in a d e q u a te i n many r e s p e c t s , and a s sum p tio n s w ere r e q u i r e d t h a t l im i t e d th e s tu d y i n s c o p e . However, t h e . f i n d i n g s and m ethodo logy open th e d o o r t o f u t u r e r e s e a r c h i n t h i s — 66 — and r e l a t e d a r e a s . T here i s a d e f i n i t e n e ed f o r e x te n d ed e m p i r ic a l r e s e a r c h t o t e s t more c om p le te ly h y p o th e s e s o f t h i s s tu d y and e x te n d th e a p p l i c a b i l i t y o f th e r e s u l t s t o th e g r e a t v a r i e t y o f f a rm in g s i t u a t i o n s w here p r o d u c t io n i s u n c e r t a i n . The l im i t a t i o n s w ere many. The s e l e c t e d a r e a s r e p r e s e n t a m inor p o r t i o n o f t h e w h e a t-p ro d u c in g a r e a s i n t h e S t a t e o f M ontana. The y i e l d d a t a from w i th in t h e s e a r e a s w ere from o n ly one s p u ro e , and t h e r e i s some p o s s i b i l i t y o f b i a s a r i s i n g from r e p o r t i n g p ro c e d u re and la n d s e l e c t i o n and l i e u l a n d s . A fa rm u n i t o f o n ly one s i z e was c o n s id e r e d and somewhat r e s t r i c t i n g a s sum p tio n s w ere in t r o d u c e d c o n c e rn in g th e f i rm and th e h o u se h o ld t h a t th e u n i t c om p r is e s . The f i n d i n g s and m ethodo logy o f t h i s s tu d y c o u ld e f f e c t i v e l y be a p p l i e d t o r e s e a r c h i n { l ) th e econom ics o f in s u r a n c e a s a m eans o f S h i f t i n g r i s k f o r d r y la n d g r a i n f a rm e r s , (2 ) r u r a l a p p r a i s a l ; (3 ) fo rm s o f t e n u r e ; (4 ) econom ic s i z e o f fa rm u n i t s o p e r a t in g u n d e r d ry la n d c o n d i t i o n s , and (5 ) d e t a i l e d s tu d y o f f i n a n c i a l management f o r fa rm s o f d i f f e r e n t s i z e s , y i e l d l e v e l s , f i n a n c i a l r e q u i r em e n ts o v e r t im e , and a l t e r n a t i v e u s e s o f in com e. ■ APPENDICES TABLE I , APPENDIX A . WHEAT.YIELDS PER SEEDED ACRE BY YEARS AND AVERAGE WHEAT YIELDS, STATE-OWNED CROPIAND, SHERIDAN AND ROOSEVELT COUNTIES, MONTANA.. Y ie ld S e r ie s I 2 3 4 5 6 7 8 9 10 Year Eu. Eu. Eu. Eu. • Eu. Eu. Eu. Eu. Eu. Eu. 1935 1936 1937 1938 1939 7 .8 4 .5 2 .7 9 .4 1940 1 8 .2 11 .8 8 .4 16 .5 1 5 .7 6.9 1 9 .7 1941 7.6 10 .1 14 .9 6.5 1 1 .2 — — 7 .1 22 .3 1 6 .3 1942 18 .3 1 9 .4 14.'3 2 5 .3 1 0 .3 1 9 .7 2 3 .3 1 9 .0 22 .4 18 .4 1943 12 .8 2 0 .0 2 0 .0 2 0 .8 17 .9 0 2 1 .8 1 4 .8 — — 26 .5 1944 2 0 .8 1 5 .7 1 4 .0 14 .5 15 .1 , 2 0 .0 22.7 25.8 23 .1 1 8 .4 1945 8 .2 1 2 .3 5 .1 1 3 .8 1 .2 6 .2 1 4 .4 6 .2 13 .1 7 .0 1946 13 .9 6.9 6.2 8 .0 4 .6 8.4 9 .3 7 .8 18 .1 11 .5 1947 11 .0 5 .3 8 .4 6 .7 12 .8 1 0 .4 14.4 16 .8 15 .5 . 1 6 .0 1948 1 3 .3 8 .7 1 1 .8 1 0 .4 6.9 9.3 11 .9 1 0 .2 .17 .8 9.6 1949 1 3 .3 9.9 6.9 3 .8 3.3 4 .9 3 .2 4 .3 13 .0 7 .7 • 1950 3 1 .2 19 .1 24 .1 1 9 .6 1 1 .4 2 0 .1 13 .6 2 1 .6 27 .5 2 4 .3 1951 16 .5 9.6 8 .7 9 .0 4 .6 7 .1 8 .0 2 .5 , 0 1 0 .0 1952 1 9 .0 1 7 .2 1 9 .4 1 4 .3 14 .1 1 1 .3 1 2 .4 1 5 .6 10 .5 6.1 1953 27.9 2 1 .4 18 .9 13 .9 1 0 .4 15 .1 11 .9 2 9 .4 25 .1 19.6 1954 15 .1 13 .9 1 2 .8 5 .5 7.9 1 0 .7 5 .0 1 3 .0 18 .1 9.8 1955 2 6 .2 2 2 .3 2 7 .4 1 6 .7 24.6 23 .1 14 .9 1 8 .2 2 5 .0 12.6 1956 1 5 .7 11 .3 1 4 .0 8 .4 — — 7 .8 5.2 8 .3 1 0 .4 6 .3 Avg. Y ie ld 17 .5 1 3 .7 - 1 3 .8 1 2 .8 9.7 11 .9 11 .8 1 3 .4 17 .1 13 .8 Avg. Seeded Wheat A creage 113 39 111 71 47 127 39 42 112 177 TABLE I , APPENDIX A . ( C o n t in u e d ) . WHEAT YIELDS PER SEED ACRE BY YEARS AND AVERAGE WHEAT YIELDS, STATE-OWNED CROPLAND, SHERIDAN AND ROOSEVELT COUNTIES, MONTANA. Y i e l d S e r i e s 11 12 13 -14 15 16 17 18 19 20 Year Bu.. Eu. Bu. - Eu. Eu. ■ Bu.. • Eu, Eu. Eu. Eu. 1935 3 .5 1936 O 1937 — — 1938 3 .0 5 .5 3 .0 3 .4 4 . a 5 .3 3 .3 4 .4 1939 8 .0 3 .1 5 .6 7 .8 — 6 .2 6 .5 —— 1 5 .4 1940 17 .1 7 .9 1 0 .7 8 .5 1 9 .6 1 0 .4 1 0 .5 8 .7 - 7 .8 . 8 .3 1941 . 1 1 .7 1 4 .7 1 8 .7 ' 1 9 .5 1 3 .8 19.5, 1 4 .8 1 6 .3 2 4 .6 15 .1 1942 1 1 .8 ' 1 8 .7 2 2 .2 1 7 .8 2 4 .6 , 2 3 .8 19 .1 1 .4 1 0 .7 2 0 .9 1943 1 9 .8 1 6 .2 2 .5 1 0 .7 18 .1 2 0 .1 1 1 .7 19 .8 25 .9 2 5 .7 1944 1 4 .4 9 .8 2 4 .2 2 1 .7 1 1 .3 19 .8 2 1 .7 2 2 .3 19.6- 1 7 .3 1945 9 .1 4 .2 1 5 .0 11 .1 1 1 .3 1 2 .9 1 4 .7 1 5 .2 1 4 .2 28 .1 1946 8 .7 6 .5 1 0 .3 1 1 .6 1 4 .0 . 9 .6 16 .1 1 4 .3 - 1 1 .3 1 7 .6 1947 — — 10 .1 10 .1 1 0 .6 1 1 .2 1 2 .7 1 1 .0 14 .6 13 .9 1 7 .3 . 1948 8 .5 11 .8 1 2 .9 6 .8 16 .5 5 .4 7 .0 8 .4 8 .2 1 5 .6 1949 5 .0 1 .3 O 4 .1 O 4 .1 6 .0 4 .3 2 .4 5 .4 1950 2 2 .3 1 9 ,0 1 3 .7 1 9 .3 18 .8 1 9 .4 11 .5 18 .9 15 .5 2 9 .0 1951 1 2 .9 1 3 .9 11 .5 7 .1 1 2 .3 13 .5 7 .7 1 2 .0 9 .5 2 5 .7 1952 6 .0 1 4 .0 7 .0 7 .0 9 .7 8 .6 8 .1 6 .3 1 4 .4 7 .9 1953 1 7 .2 . 2 4 .0 1 8 .7 1 5 .9 2 5 .7 27 .1 1 1 .6 2 0 .6 2 6 .4 26 .1 1954 O O 16 .0 7 .9 1 0 .4 8 .1 9 ,9 1 2 .8 13 .1 1 3 .2 1955 6 .9 2 6 .1 2 2 .0 . 2 1 .3 1 8 .2 2 5 .6 1 1 .6 1 7 .6 2 8 .0 17 .5 - 1956 ._ 9 .5 9 .2 9 .4 . 7 .3 10 .9 15 .1 7 .2 6 .5 11 .8 17 .5 Avg. Y ie ld 1 1 .1 1 1 .2 1 1 .4 11 .5 13 .9 1 4 .0 1 1 .2 1 2 .4 15 .1 1 7 .3 Avg. Seeded Wheat A creage 61 123 59 46 100 146 125 124 104 112 TABLE I , APPENDIX A 6- ( C o n t in u e d ) . WHEAT YIELDS PER SEEDED ACRE BY YEARS AND AVERAGE WHEAT YIELDS, STATE-OWNED CROPLAND, SHERIDAN AND ROOSEVELT COUNTIES, MONTANA. Y i e ld S e r i e s 21 • 22 23 24 25 26 27 28 29 30 Year Bu. Eu. Eu. Eu. Eu. Eu. Eu. Eu. Eu. Eu. 1935 1936 1937 1938 8 .0 6 .8 . 4 .7 4 .8 1939 14 .1 1 3 .6 1 0 .8 9 .5 9 .8 6 .5 1940 — — 1 6 .2 6 .3 0 1 6 .2 1 5 .3 7 .4 8 .2 1941 16 .6 1 6 .4 1 0 .4 2 4 .2 5 .8 — 19.9 1 3 .3 5 .1 1 1 .3 1942 1 7 .8 1 8 .5 5 .0 2 0 .2 3 0 .3 1 8 .8 2 1 .3 1 0 .7 9 .6 1 8 .7 1943 2 2 .8 1 8 .9 11 .5 2 3 .9 19 .1 2 3 .1 2 5 .9 1 1 .3 1 2 .3 2 3 .7 1944 26 .1 1 8 .0 - 1 0 .3 1 7 .9 ■ 13.-7 2 8 .1 1 7 .4 6 .9 7 .2 8 .6 1945 2 1 .8 15.9 . 5 .1 16 .1 1 2 .8 ' 1 4 .7 ' 1 6 .3 9 .2 1 3 .4 1 5 .0 1946 1 5 .2 1 6 .8 5.7 1 3 .7 - 0 . . 5.9 1 5 .0 2 .1 1 1 .0 .8 1947 1 8 .8 15 .1 4 .0 1 4 .2 1 0 .8 1 7 .2 1 6 .0 7 .2 1 6 .0 1 3 .2 1948 1 4 .2 6 .3 3 .7 16.4 1 0 .7 2 2 .5 1 8 .4 7 .1 2 8 .0 1 7 .7 1949 15 .1 6.5 1 .3 7 .9 0 7 .5 9 .1 1 1 .2 1 9 .8 8 .6 1950 2 0 .6 2 6 .5 7 .0 2 5 .3 1 3 .6 2 3 .6 25 .1 13 .6 2 5 .5 2 1 .4 1951 9 .8 1 0 .2 4 .0 14.6 8 .2 1 0 .7 12.2 5.9 1 3 .0 8 .6 1952 4 .8 9 .1 1 .5 5.3 4 .0 8.9 7 .3 4 .1 9 .1 2 .4 1953 1 2 .9 1 9 .3 1 0 .3 13 .1 20 .1 1 6 .0 2 0 .6 12 .1 2 5 .9 2 2 .2 1954 0 7 .3 8 .3 1 0 .6 9.1 7 .5 1 2 .0 11 .1 9 .3 7 .1 1955 1 5 .2 2 2 .8 7.2 2 1 .7 2 0 .0 21 .1 2 7 .2 11 .5 1 9 .3 18 .3 1956 . — — 1 3 .4 4 .2 1 3 .7 4 .1 7 .0 1 2 .0 .7 «— Avg. Y ie ld 1 4 .9 1 4 .6 6 .2 1 4 .4 - 1 1 .7 15 .1 1 5 .7 8 .5 14 .5 1 3 .2 Avg. Seeded Wheat A creage 169 169 64 146 118 87 157 96 293 37 TABLE I I , APPENDIX A . WHEAT YIELDS PER SEEDED ACRE AND AVERAGE WHEAT YIELDS, STATE-OWNED. CROP- • LAND, JUDITH BASIN AND FERGUS COUNTIES, MONTANA. Y ie ld S e r ie s I 2 3 4 5 6 7 8 9 Year Bu. Bu. Eu. Bu. ' Eu. Eu. Eu. Eu. Eu. 1932 1933 1934 8.0 1935 5.2 - 1936 —— 1937 2.4 4 .6 5.9' 3 .2 4.0 1938 14.3 9.9 10 .1 17.9 6 .8 1 1 .3 . 1939 11 .1 14.8 9 .1 2 2 .5 1 0 .8 1 1 .4 3.7 11 .9 — 1940 14 .6 9.3 4.9 2 0 .7 6 .2 . 9.1 2 0 .0 --- 1 1 .6 1941 5.0 29.2 6 .2 3 1 .0 15.3 19.5 2 2 .2 21.5 2 0 .7 1942 24.6 3 2 .4 . 26.0 37.3 2 2 .6 3 0 .5 3 2 .6 3 3 .5 5 1 .5 1943 10.0 21.6 19.2 3 9 .9 1 7 .9 19 .9 19.6 2 1 .5 23.7 1944 8.0 30.3 1 5 .3 9.2 1 7 .6 18 .6 1 6 .0 2 2 .5 ■ 1 7 .2 1945 6 .1 • 2 3 .4 13 .1 3 3 .3 8.6 25.9 16 .6 2 1 .6 15.5 1946 1 1 .2 22.5 2 0 .7 29.4 1 6 .6 14 .1 14 .4 14 .4 16 .8 1947 7 .7 O 11 .5 12..1 1 4 .0 1 5 .5 13.6 0 16 .3 1948 3 1 .7 27.2 11 .3 51.9 2 4 .8 27.0 20.4 3 .4 ■ 2 1 .3 1949 10.9 23.5 1 7 .0 30 .1 1 6 .6 2 0 .7 2 8 .0 2 3 .5 10 .7 1950 17.0 27 .1 1 8 .8 21.5 1 6 .7 1 4 .5 2 .6 22.7 21 .1 1951 1 3 .3 2 6 .7 1 6 .2 31 .-8 1 5 .1 22.0 19.5 21.5 3 1 .3 1952 — —. 7 .4 1 2 .8 3 3 .7 14.0 18.4 15 .8 1 7 .2 21.3 1953 20.0 23.0 18 .6 2 7 .0 14.5 22.1 16 .8 23.0 18 .6 1954 18.7 16.9 18 .1 3 8 .6 27.2 36.9 29 .1 3 2 .5 25.0 1955 18.6 2 7 .7 16 .9 3 7 .6 17 .6 1 7 .3 41.8 3 4 .5 31 .5 1956 8.7 / 22.5 17 .1 2 0 .4 —— 24.9 12.5 1 4 .3 1 2 .7 Avg. Y ie ld 13.4 1 8 .8 1 4 .4 2 9 .3 16.2 19.5 17.8 2 0 .0 21 .0 Avg. Seeded Wheat A creage 36 54 200 69 67 224 151 63 47 TABLE II ,-A P PEN D IX A . ( C o n t in u e d ) . WHEAT YIELDS PER SEEDED.ACRE AND AVERAGE:WHEAT YIELDS, STATE-OWNED CROPLAND, JUDITH BASIN AND FERGUS COUNTIES,1 MONTANA. Y ie ld S e r ie s 10 11 12 13 14 15 16 17 18 Year Eu. Eu. Eu. Eu. Eu. Eu. Eu. Eu. Eu. 1932 0 1933 — 1934 4 .1 1935 4 .9 1936 ■ 1 .7 1937 2 .8 2.8 5 .4 1938 8 .0 2 1 .6 19 .6 2 2 .1 3 .7 3 4 .0 1939 O 4 .4 3 .8 1 3 .1 1 0 .7 1 4 .2 — 1940 O 1 .7 4 .3 — — 2.0 1 3 .3 20 .1 . 1 1 .8 14 .1 1941 1 1 .0 3 .2 5 .7 6.9 1 3 .8 2 4 .2 20.4 19 .8 2 9 .0 1942 1 3 .6 12 .1 1 0 .7 2 3 .3 2 5 .7 3 1 .4 2 8 .2 8 .5 1943 11 .1 4 .3 17 .1 1 6 .0 1 1 .1 2 9 .2 3 3 .9 19 .1 — 1944 1 4 ,0 16 .6 1 6 ,4 2 0 .3 8 .8 1 0 .9 1 1 .5 12 .1 3 6 .5 1945 8 .7 10 .1 1 6 .7 17.9 2 3 .9 9.7 7 .8 35 .6 2 3 .6 1946 2 .5 9.6 9 .1 6 .7 1 2 .7 1 6 .9 1 0 .8 30.1 1 .8 1947 7 .8 4 .2 — — 4 .1 9 .1 6 .1 2 .6 9.7 11 .6 1948 2 0 .8 8 .2 8 .4 11 .6 2 2 .6 30.0 3 0 .0 3 2 .3 2 .3 1949 1 1 .2 6 .4 4 .8 5.7 1 5 .2 18 .6 12.2 2 7 .0 23 .1 1950 15 .6 6 .2 7 .7 7 .2 2 7 .4 27.6 — 1 5 .2 1 9 .0 1951 1 5 .3 6 .3 12 .1 1 0 .0 1 6 .9 1 4 .0 9 .0 15.2 1 8 .0 1952 7 .8 2 .0 5 .0 13.4 1 4 .7 17 .1 7 .1 14 .6 1 2 .5 1953 12 .9 7 .1 1 2 .6 14.0 12 .9 16 .8 14 .6 7 .4 1 8 .7 1954 2 5 .1 7 .4 2 0 .4 10 .9 2 0 .8 2 5 .1 22.6 27.4 21 .1 1955 1 6 .2 9.1 29.6 1 4 .7 4 .0 3 2 .9 2 4 .5 22.3 1 7 .4 1956 2 0 .4 3 .7 1 6 .4 8.0 7 .3 1 4 .3 12 .8 14 .9 18 .3 Avg. Y ie ld 1 1 .6 7 .0 1 2 .5 10 .7 14 .1 1 5 .8 15 .5 20 .9 1 7 .2 Avg. Seeded Wheat A creage . 21 71 65 33 43 178 78 75 84 TABLE I I , APPENDIX A . ( C o n t i n u e d ) . WHEAT YIELDS PER SEEDED ACRE AND AVERAGE WHEAT YIELDS, STATE-OWNED CROPLAND, JUDITH BASIN AND FERGUS COUNTIES,- MONTANA.. Y i e l d S e r i e s 19 20 21 Year Eu. Eu. Eu. 1932 1933 1934 1935 . 1936 1937 1938 8 .2 1 3 .5 2 0 .6 1939 11.0 1 1 .5 1 2 .0 1940 7 .4 5 .8 7 .9 1941 8.8 1 1 .5 14.2 1942 1 0 .7 1 1 .5 — 1943 12 .1 9.8 9.7 1944 21 .6 1 4 .0 1 6 .6 1945 5.2 5 .1 1 5 .2 1946 11 .6 10 .6 13.8 1947 29 .8 8.9 6.0 1948 3.8 1 6 .2 2 3 .2 1949 7 .1 10 .1 19 .1 1950 — 1 0 .8 4 1 .7 1951 12 .6 8 .5 19.9 1952 6.4 7 .8 1 6 .7 1953 1 0 .0 5.4 27.7 1954 9.4 6 .4 2.7 1955 5 .4 10 .9 23.9 1956 — 5 .6 1 1 .2 Avg. Y ie ld . 10.6 9 .7 16 .8 Avg. Seeded Wheat A creage 83 212 195 22 23 24 25 26 Eu. Eu. Eu. Eu. Eu. 23.5 ’ 3 .6 24 .9 3 .6 6 .0 1 0 .8 12.2 6.1 8 .4 12.9 6.2 8 .5 12 .8 24.7 2 1 .3 3 2 .2 2 1 .6 21 .3 30.5 21.7 32 .1 17 .1 18 .9 2 0 .0 1 1 .5 1 7 .0 1 5 .3 2 0 .7 17 .9 1 7 .3 19.3 6 .3 7 .2 1 4 .9 20.2 24.3 6 .8 9 .6 1 6 .0 1 0 .7 2 0 .1 1 2 .2 — 6.9 11 .8 1 6 .6 10.9 9 .2 18 .3 2 6 .2 29.6 1 4 .4 1 7 .0 18 .5 23,8 -25 .4 . 2 2 .2 16 .6 19.7 1 1 .2 1 8 .7 17 .8 8 .7 1 4 .4 1 4 .4 23.6 . 18 .6 10 .1 8 .6 1 2 .0 1 0 .2 1 1 .7 10 .6 21.9 5 .8 9.3 6 .0 8 .1 6 .2 9.5 0 0 0 1 3 .5 15 .5 16 .5 1 3 .2 2 2 .7 10 .8 1 0 .4 13.3 10 .8 — 1 6 .3 14.5 17 .9 12 .8 11 .7 257 146 78 275 123 27 Eu. . 2 2 .3 1 1 .7 1 5 .0 12.0 17.2 14 .6 - 10.3 4 3 .8 27.3 2 4 .2 1 8 .6 1 5 .0 23.1 13.4 1 7 .0 1 1 7 CO I CO O TABLE I I 9 APPENDIX A. ( C o n t in u e d ) . WHEAT YIELDS PER SEEDED ACRE AND AVERAGE WHEAT YIELDS, STATE-OWNED CROPLAND, JUDITH BASIN AND FERGUS COUNTIES, MONTANA. . Y i e l d S e r i e s Year Eu. Eu. Eu. Eu. Eu. 1932 1933 1934 1935 1936 1937 1938 22.9 7 .0 .7 8 .3 1939 8 .5 19.3 8 .1 ■ 1 3 .7 1940 15.9 18 .8 3.4 7.2 1941 2 4 .4 20.6 7 .2 1 7 .5 1942 3 6 .6 28 .1 5 .1 2 2 .2 1943 2 1 .3 25.9 1 4 .5 22.5 1944 1 9 .6 25 .1 17 .9 22.3 1945 29/0 22 .1 10.8 2 2 .3 1946 1 5 .5 19 .1 13.3 1 6 .4 1947 1 4 .0 15 .6 11 .8 1 3 .3 1948 1 9 .5 — 16 .1 25.7 1949 2 6 .7 24 .3 10.2 2 5 .3 1950 18.0 15.6 15 .5 29.5 1951 1 9 .2 10.9 1 3 .0 12.8 •1952 2 0 .2 . 1 4 .8 13.9 1 8 .0 1953 2 4 .0 17 .7 15 .3 2 8 .5 1954 1 0 .2 • 19.0 13 .8 29.1 1955 2 2 .8 . 2 6 .5 11.3 2 6 .0 1956 8 .5 14 ,1 8 .2 1 9 .6 Avg. Y ie ld 1 9 .7 20.0 * 11 .4 19.0 Avg. Seeded Wheat A creage 166 160 144 165 3 .6 1 4 .2 2 5 .6 1 3 .0 13 .7 1 2 .3 21.0 — — ■ 8 .7 10.2 1 1 .7 0 23.4 2 8 .0 1 8 .2 5 .3 18 .6 1 9 .9 3 5 .8 1 0 .3 13 .6 27 .6 19 .6 1 7 .8 9.5 14 .1 20.4 20 .9 14 .9 2 3 .8 2 8 .5 2 1 .2 21 .9 23 .4 = 0 17 .1 2 2 .1 1 6 .8 4 .3 13 .2 6 .4 10 .3 1 3 .2 4.4 9.9 18 .1 10.6 16 .8 1 2 .5 1 3 .7 1 5 .8 . 7.6 17 .1 2 6 .2 2 1 .2 2 0 .7 13 .7 23 .9 1 4 .0 2 4 .7 1 7 .0 17 .7 13 .1 9.3 1 2 .4 16 .1 7 .9 5 .9 1 8 .3 19.8 1 2 .7 19 .6 1 4 .2 8.5 3 .3 10.3 1 0 .3 14.8 2 3 .0 1 6 .0 1 7 .2 21.5 18 .3 2 4 .7 2 3 .1 2 1 .7 17 .5 15 .1 1 8 .4 3 3 .0 2 8 .6 19.2 8.3 18.0 1 7 .7 25 .1 19.6 1 5 .4 1 3 .2 20.5 13.3 2 3 .5 8.2 13 .1 15 .9 13 .6 1 3 .4 ' 2 1 .8 1 6 .8 1 4 .9 13.2 16 .4 114 68 86 68 90 58 75 TABLE I I I , APPENDIX A 0 YIELD VARIATION BY YEARS, STA^E-OWNED TRACTS OF CROPLAND, SHERIDAN AND ROOSEVELT•COUNTIES, MONTANA. Year ■ O b se rv a t io n s Mean 'Y ie ld S ta n d a rd D e v ia tio n Number Bu. ■ Eu. 1938 15 5 .1 1 .7 0 1939 27 8 .0 3 .6 2 1940 35 1 1 .0 5 .2 1 1941 . 36 14 .1 5.95 1942 41 17 .6 6 .8 1 1943 38 17 .5 6.93 1944 43 1 7 .4 4 .9 8 1945 43 12.4 5.25 1946 41 9.8 4 .6 7 1947 40 1 2 .4 3 .4 6 1948 42 11 .6 5 .2 3 1949 44 6.2 4 .3 1 1950 44 19 .6 5 .6 0 1951 44 1 0 .4 4.26 1952 42 9 .4 4 .5 8 1953 44 17 .8 6 .1 4 1954 44 10 .0 4.34 1955 44 . 1 9 .7 5 .7 9 1956 38 9.6 4 .1 2 C o e f f i c i e n t o f V a r ia t io n P e t . 3 3 .3 4 5 .2 4 7 .4 4 2 :2 . 3 8 .7 39.6 28.6 4 2 .3 4 7 .6 2 7 .9 4 5 .1 69.5 28.6 4 1 .0 48.7 34 .5 4 3 .4 2 9 .4 4 2 .9 - 76 / TABLE IV , APPENDIX A. YIELD- VARIATION CROPLAND, JUDITH MONTANA. BY YEARS, STATE-OWNED TRACTS OF BASIN'AND FERGUS COUNTIES, Y ear O b s e rv a t io n s ' Mean ^ Y ie ld S ta n d a rd D e v ia t io n C o e f f i c i e n t o f V a r ia t io n Number Ba. Eu. P o t . 1937 15 3.3 1 .7 3 49.1 1938 48 1 5 .0 6.88 - 45.9 1939 45 1 0 .9 5 .1 3 47 .1 1940 49 9 .4 5 .5 8 59.4 1941' 57 16 .1 7 .85 4 8 .8 .1942 56 2 1 .2 10.25 48.3 1943 • 59 16.8 • 8.06 4 8 .0 1944 67 1 5 .7 7 .73 . _ . 49.2 1945 63 15.2 8.28 5 4 ,5 1946 65 1 3 .2 5.68 43.0 1947 I . 63 1 0 .3 5.50 • 53.4 1948 65 ' 1 9 .0 9.60 5 0 .5 1949 . 63 15 .6 7 .2 2 4 6 .3 1950 64 16.3 8 ,1 4 50.0 1951 68 ' ' . 13.9. • 5.62 4 0 .4 1952 66 13.3 6.37 . 4 7 .9 1953 63 15.8 6.94 43.9 1954 67 16.5 , .9.99 6 0 .5 1955 66 19.7 ' 8 .0 9 4 1 .1 1956 62 11 .9 4.96 41.7 ' - 7 7 - TABLE V , APPENDIX ,A . YIELD VARIATION ON 3 0 STATE-OWNED TRACTS OF CROP- ; LAND, SHERIDAN AND ROOSEVELT COUNTIES, MONTANA. Y ie ld S e r ie s Ranqe Twsp. S e c t io n Y ears o f D ata Mean Y ie ld S ta n d a rd . D e v ia t io n C o e f f i c i e n t o f V a r ia t io n No. • Eu. Eu. P e t . I 53 37 16 15 ■ 17 .5 6 .3 0 3 6 .0 2 54 37 16 18 1 3 .7 5 .3 9 39.3 3 55 37 36 17 13 .8 . 6 .1 6 4 4 .6 4 58 37 4 16 1 2 .8 5 .7 4 4 4 .8 5 52 36 32 17 9 .7 5.77 59.5 6 54 . 36 16 IT . 1 1 .9 6 .1 2 5 1 .4 7 57 36 36' 17 11 .8 6 .6 3 56.2 8 51 - 35 23 17 1 3 .4 7 .4 9 55.9 9 52 35 36 17 17 .1 6.90 4 0 .3 10 53 35 16 16 1 3 .8 6.19 4 4 .8 11 53 35 3 17 11 .1 , 5 . 4 3 48.9 12 56 34 16 , 19 1 1 .2 7.26 64.8 13 57 34 16 21 1 1 .4 7.03 6 1 .7 14 58 34 36 19 11 .5 5 .7 5 5 0 .0 15 55 33 36 18 13 .9 6 .3 2 ■45.5 16 57 33 16 19 1 4 .0 7.13 50.9 17 58 33 16 19 1 1 .2 4.38 39.1 18 58 32 16 18 1 2 .4 6.20 • 5 0 .0 19 59 32 16 17 15 .1 7 .1 4 4 7 .3 20 55 31 36 19 1 7 .3 7.22 4 1 .7 21 57 31 36 17 14 .9 6.40 42.9 22 58 ■ 31 16 19 14 .6 5.57 38 .1 23 59 ' 31 16 17 - 6.2 3 .0 1 48.5 24 56 30 36 19 1 4 .4 6.76 46.9 25 54 29 16 17 1 1 .7 7.73 66 .1 26 . 56 29 27 17 15 .1 6 .7 3 44.6 27 59 29 16 19 1 5 .7 6.43 4 0 .9 28 58 28 16 17 8 .5 3 .7 3 43.9 29 58 28 36 ■ 16 14 .5 6.93 47.8 30 57 27 10 15 1 3 .2 6.89 52.2 V 7 8 - TABLE V I , APPENDIX A . YIELD VARIATION ON 3 7 STATE-OWNED TRACTS OF CROPLAND, JUDITH BASIN AND FERGUS'COUNTIES, MONTANA. Years Coefficient Yield Series Ranae Twsd . Section of Data Mean Yield Standard Deviation of. Variation No, • Eu, . Eu. • Pet. I 20 22 35 19 ' 1 3 .4 7 .0 0 52.2 2 21 17 36 22 1 8 .8 9.48 5 0 .4 3 "21 19 , 16 .20 1 4 .4 5 .3 4 37.1 4 13 19 ' 21 18 29.3 10 .15 34.6 5 13 19 35 17 1 6 .2 5 .1 1 31 .5 6 13 19 36 20 19 .5 ■ 7 .3 6 37.7 7 15 19 36 20 1 7 .8 9.67 5 4 .3 8 16 ■ 19 16 ' 17 2 0 .0 9 .1 0 45.5 9 16 19 36 18 2 1 .0 9.48 45 .1 10 18 19 36 18 11 ,6 6.69 5 7 .7 11 22 19 36 17 7 .0 3 .8 6 55 .1 12 ' 9 18 16 18 12 .5 6.88 55 LO 13 10 18 35 17 1 0 .7 4.69 42.8 14 i i 18 36 20 14 .1 7 .0 8 5 0 .2 15 13 18 16 24 15 .8 9 .5 4 6 0 .4 16 13 18 14 19 15.5 9 .2 2 59.5 17 13 18 36 18 20 .9 8.66 • 4 1 .4 18 17 18 16 16 1 7 .2 8.69 50 .5 19 10 17 28 17 1 0 .6 6 .1 8 5 8 .3 20 11 17 30 . 19 9.7- 3,05 31 .4 21 11 17 13 18 16.8 8 .7 5 52.1 22 12 17 4 19 1 6 .3 6.19 38.0 23 12 17 34 20 14.5 6.44 4 4 .4 24 12 . 17 25 18 17 .9 8.78 4 9 .0 25 13 17 19 . 16 12 .8 5 .8 6 4 5 .8 26 13 17 8 18 1 1 .7 6.24 5 3 .3 27 13 17 .16 16 1 7 .0 9.78 5 7 .5 28 14 17 16 18 19.7 7 .0 0 35.5 29 13 16 31 . 18 2 0 .0 4 .6 7 23.3 30 12 36 19 1 1 .4 3 .8 9 34 .1 31 13 > 15 36 20 19 .0 . 7.68 ' 4 0 .4 32 15 - 15 36 20 1 3 .4 5.62 41 .9 33 16 14 16 19 2 1 .8 . ' 6.67 30.6 34- 15 • . 13 36 18 1 6 .8 6 .4 1 38 .1 35 15 12 5 14 14.9 5 .2 7 35.4 36 15 12 12 1# 13.2 5 .4 6 41.4 ■ 37 16 12 36 1 9 , 16.4 ' ■ 6.57 40 .1 7-9 - TABLE I , APPENDIX B . iYEARLY EXPENSES FOR A FARM UNIT CONSISTING OF A FOUR-MEMBER HOUSEHOLD AND A 1 ,6 .4 0 CROP ACRE FIRM , BY AREAS, MONTANA.a / C ost I tem S p r in g Wheat A rea W in te r Wheat A rea D o l. ■ D ol- F u e l , o i l , g r e a s e , and r e p a i r s 1 ,0 3 7 .0 0 1 ,0 8 2 .0 0 Seed t r e a tm e n t 7 0 .5 0 75 .00 Weed s p ra y in g 1 ,0 2 5 .0 0 1 ,0 2 5 .0 0 F irm c a r exp en se 215 .00 200 .00 P ick up and t r u c k expen se 502 .50 480 .0 0 In su ra n c e 200 .00 206 .00 Taxes 3 40 .00 377 .00 H ired l a b o r 2 0 0 .OQ 200..00 Board and room f o r h i r e d l a b o r 6 0 .0 0 6 0 .0 0 T e lep h o n e , h e a t and e l e c t r i c i t y 3 00 .00 300 .00 S u p p l ie s and m is c e l la n e o u s 4 00 .0 0 4 0 0 .0 0 F irm f ix e d c o s t s 4 ,3 5 0 .0 0 4 ,4 0 5 .0 0 Food 900 .00 9 0 0 .0 0 In su ra n c e and m ed ic a l c o s t s 3 60 .00 3 60 .0 0 T e lep h o n e , h e a t and e l e c t r i c i t y 3 00 .0 0 3 00 .0 0 H ouseho ld c a r expense 215 .00 200 .00 C lo th e s and m is c e l la n e o u s exp en se 6 0 0 .0 0 600 .0 0 Househo ld f ix e d c o s ts 2 ,3 7 5 .0 0 2 ,3 6 0 .0 0 Farm u n i t f ix e d c o s t s . 6 ,7 2 5 .0 0 6 ,7 6 5 .0 0 Firm , f ix e d c o s t s p e r seeded a c re 5 .3 0 5 .3 7 Househo ld f ix e d c o s ts p e r seeded a c re 2 .9 0 2 .8 8 Farm u n i t f ix e d c o s t s p e r seeded a c re 8 .2 0 8 .2 5 These e x p en se s a r e c o n s id e re d f ix e d f o r th e assumed fa rm u n i t ; th e y a r e th e d o l l a r r e q u ir em e n ts a s s o c i a te d w ith a z e ro y i e l d . 80 ' ' LEVELS' IN THE SPRING ,.WHEAT: AREA. ' - 1 ' . ■ TABLE T I , APPENDIX B . FARM UNIT NET CASH LOSS OR PROFIT AT VARIOUS YIELD Farm Unit Farm Unit Farm Unit Farm Farm Unit Gross Farm1Unit Loss or Loss or Yield' ■ Yield Income 'Expense ■ Profit, Profit Eu. Bu.iL/ Dolob/ DoL.J2/ Dol .2/ 'Dol.c/ 0 - 2 . 1 0 0 8 .2 00 -8 .2 0 0 -6,724 2 .2 .1 .650 2.485 - 8 .6 5 0 -6 .1 6 5 -5 ,0 5 5 2 .3 1 .7 2 5 ■ 2.600 8 .6 7 0 -6 .0 7 0 -4,977 2 .4 1 .8 0 0 2 .7 1 0 ■ 8 .7 0 0 -5 .9 9 0 -4 ,9 1 2 2 .5 1 .8 75 2 .8 2 0 8 .7 20 -5 .9 0 0 -4 ,8 3 8 2.6. 1 .9 5 0 2 .9 4 0 8 .7 4 0 -5 .8 0 0 -4 ,7 5 6 2 .7 2.025 3 .0 50 8 .7 7 0 -5 .7 2 0 -4 ,6 9 0 2 .8 2 .1 0 0 3 .1 60 8 .7 90 -5 .6 3 0 - 4 ,6 1 7 2 .9 2 .1 7 5 3 .2 8 0 8 .8 20 -5 .5 4 0 -4,543 3 .0 2 .2 5 0 3 .3 90 8 .8 4 0 -5 .4 5 0 -4 ,46 .9 3 .1 2 .3 2 5 3 .5 00 8 .8 6 0 ■ -5 .3 6 0 -4 ,3 9 5 3 .2 2 .4 0 0 3 .615 8 .8 9 0 -5 .2 7 5 -4 ,3 2 5 3 .3 2 .4 7 5 3 .7 30 8 .9 1 0 -5 .1 8 0 -4 ,2 4 8 3 .4 2.550 3 .8 40 8 .9 3 0 \ - 5 .0 9 0 -4 ,1 7 2 i3.5 2 .6 2 5 3 .9 50 8 .9 6 0 -5 .0 1 0 -4,108 3.6 2.700 4 .0 7 0 ,8.980 ' -4 .9-10 -4 ,026 . 3 .7 2 .7 7 5 4 .1 8 0 9.01-0 -4 .8 3 0 -3 ,9 6 1 ' 3 .8 2 .8 5 0 . 4 .2 9 0 9 .0 3 0 . - 4 .7 4 0 -3,887 3 .9 2.925 / 4 .4 05 9 .0 6 0 -4 .6 4 5 -3 ,8 0 9 4 .0 3 .0 0 0 ■' 4 .5 2 0 9 .0 8 0 • - 4 .5 6 0 -3 ,7 3 9 4 .1 3 .0 7 5 4 .6 3 0 9 .1 0 0 -4 .4 7 0 -3 ,6 6 5 4 .2 3 .1 5 0 4 .7 4 0 9 .1 2 0 -4 .3 8 0 -3,592 4 .3 ' 3.225 4 .8 6 0 9 .1 4 0 -4 .2 8 0 -3 ,5 1 0 4 .4 3 .3 0 0 4 .9 7 0 9 .1 6 0 -4 .1 9 0 -3,436 4 .5 3.375 5 .0 8 0 9 .1 8 0 -4 .1 0 0 -3 ,3 6 2 4.6 3 .4 5 0 . 5 .2 0 0 9 .2 0 0 -4 ,0 00 . -3 ,2 8 0 4 .7 3 .5 2 5 " 5 .3 1 0 9.220 - 3 .9 1 0 ■ -3 ,2 0 6 4 .8 3 .6 0 0 5 .4 2 0 9 .2 4 0 -3 .8 2 0 -3,132 4.9 3 .6 7 5 ' 5 .5 35 9 .2 6 0 -3 .7 2 5 -3 ,0 5 5 5 .0 3 .7 5 0 '5 .6 5 0 9.280 ■ -3 .6 3 0 -2,977 5 .1 3 .8 25 . . 5 .7 6 0 9 .3 0 0 - - 3 ,5 4 0 - 2 ,9 0 3 5.2 3 .9 0 0 5 .8 7 0 9 .3 2 0 -3 .4 5 0 -2,829 5.3 3 .9 75 5 .9 9 0 9 .345 -3 .3 5 5 -2,751 5 .4 4 .0 5 0 6 .1 0 0 " 9 .3 7 0 -3 .2 7 0 -2 ,6 8 1 5 .5 . 4 .1 2 5 ■ 6 .2 1 0 9 .3 9 0 -3 :1 8 0 -2 ,6 0 8 2 / See footnote at the end of Table. k / See footnote at the end of Table. c / See footnote at the end of Table. 8 1 _ TABLE T I , APPENDIX B . ( C o n t i n u e d ) . FARM UNIT NET CASH LOSS OR PROFIT ' AT VARIOUS 'YIELD LEVELS IN . THE SPRING WHEAT-AREA Tarm Yield Farm Unit Yield ■ Farm Uhit Gfoss "Income Farm Unit Expense Farm Unit Loss or Profit . Farm Unit Loss or Profit. Eu. B u .! / ■ D o I . ! / Pol.!/ ■ Dol.!/ ‘ Dol.!/ 5 .6 4 .2 0 0 . ' '6 .325 9 .4 1 0 -3 .0 8 5 ■ -2 ,5 3 0 . 5.7. 4.275' • , 6 :4 4 0 - 9 .4 3 0 -2.990 - 2 '4 5 2 ' 5 .8 4 .3 5 0 6 .5 5 0 9 .4 5 0 -2 .9 0 0 - -2,378 5.9 4 .4 2 5 6 .6 6 0 9 .4 7 0 -2 .8 1 0 - 2 ,3 0 4 6 .0 4 .5 0 0 6 .7 8 0 9 ,4 9 0 -2 .7 1 0 -2,222 ■ 6 .1 4 .5 7 5 6 .8 90 9 .5 1 0 -2 .6 2 0 -2 .1 4 8 6 .2 4 .6 5 0 7 .0 00 9 .5 3 0 -2 .5 3 0 -2 ,0 7 5 6 .3 4.725 7 .120 9 .5 5 0 -2 .4 3 0 -1,993 6 .4 4>800 7 .230 9 .565 -2 .3 3 5 ■ -1 ,9 1 5 • 6 .5 4 .8 7 5 7 .340 9 .5 8 0 -2 .2 4 0 - 1 ,8 3 7 6 .6 4 .9 5 0 7.455 9.595 - 2 .1 4 0 -1 ,7 5 5 ' 6 .7 5 .0 2 5 7.570 9 .6 1 0 - 2 .0 4 0 -1 ,6 7 3 . 6.8 5 :1 0 0 7 .6 80 9.625 -1 .9 4 5 ' -1,5956.9 5 .1 7 5 7 .7 9 0 -9.640 -1 .8 5 0 ' - 1 ,5 1 7 7 .0 5 .2 5 0 7 .9 10 9.655 -1.745 - M 3 1 7 .1 ' 5 .3 2 5 ( 8 .0 2 0 ' 9.670 -1 .6 5 0 -1 ,3 5 37.2 5 .4 0 0 8 .1 3 0 9.685 -1 .5 5 5 -1 (2 7 5 7 .3 5 .4 7 5 8 .2 5 0 9 .7 0 0 -1 .4 5 0 -1,189 7 .4 5 .5 5 0 8.360 9.715 -1 .3 5 5 -1 ,1 1 1 7 .5 5 .6 2 5 8 .4 7 0 9.730 -1 ,2 6 0 -1 ,0 3 3 7 .6 5 .7 0 0 8 .585 9.745 -1 .1 6 0 - 951 ' 7 .7 5 .7 7 5 8.700 9 .7 6 0 -1 .0 6 0 - 869 7 .8 5 .8 5 0 a . 810- 9 .7 75 -9.965 - 791 7.9 5.925 8,920 9 .7 9 0 - .870 - 713 8.0 6 .0 0 0 9 .0 4 0 9'. 805 - .765 - 627 8 .1 6 .0 7 5 9 .1 5 0 . ' • 9.820 - .670 - 549 8 .2 6 .1 5 0 9.260 9.835 - .575 - 472 8 .3 6.225 9.375 9.850 - .475 - 390 8 .4 6 .3 0 0 9 .4 9 0 9.865 - .375 - 308 8.5 6 .3 75 9.600 ' 9 .8 8 0 - .2 8 0 ' - 230 8.6 6 .4 5 0 ' . ■ 9 .7 1 0 9.895 . 185 - 152 8 .7 6:525 9.830 9 .9 1 0 - .0 8 0 — 66 8 .8 6 .6 0 0 9.940 9.925 + . 015: + 12 8 .9 6.675 10 ,050 9.940 - '+ .110 + 90 l / The farm u n i t y i e l d I s t h r e e f o u r th s o f th e fa rm y i e l d . O p e ra to r s incom e, e x p e n se r .a n d ,.lo s s o r p r o f i t a r e in te rm s o f d o l ­ l a r s p e r seed ed a c r e . O p e ra to r l o s s o r p r o f i t ' i n t h i s column i s c a lc u la t e d by m u l t ip ly in g th e o p e r a to r l o s s o r p r o f i t p e r se ed ed a c re by th e number o f seeded a c r e s (8 2 0 ) . 8 2 _ TABLE I I I 9 APPENDIX B . FARM UNIT NET CASH LOSS OR PROFIT AT VARIOUS . -YIELD LEVELS' IN "THE'WINTER WHEAT AREA. Farm U n it F a rn r U n it Farm U n it Farm. . Farm U n it G ro ss Farm U n it Loss o r Loss o r Y ie ld Y ield" Income. Exoenae P r o f i t . P r o f i t . ,B u - Bu-I/" D o l .c / B o l .b / D o l .b / D o l .c / 0 - 2 .2 0 0 8 .2 5 ■ - 8 .2 5 -6,765 2 .3 1 .5 3 2 .2 0 8 .6 8 - 6 .4 8 -5,314 2 .4 1 .6 0 2 .3 0 8 .7 0 - - 6 .4 0 -5 ,2 4 8 2 .5 1 .6 7 2 .4 0 8 .7 3 - 6 .3 3 -5 ,1 9 1 2 .6 1 .7 3 2 .4 8 8 .7 5 - 6 .2 7 -5 ,1 4 1 2 .7 1 .8 0 2 .5 8 8 .7 7 -6 .1 9 -5 ,0 7 6 , 2 .8 1 .8 7 2 .6 8 8 .80 - - 6 .1 2 -5,018 • 2 .9 1 .9 3 2.77 8 .8 2 -6 .0 5 -4,961 3 .0 2 .0 0 2 .8 7 8.84 -5.97 -4 ,8 9 5 3 .1 2 .0 7 2.97 8 .8 7 -5 .9 0 -4 ,8 3 8 3 .2 2 .1 3 3 .06 . 8 .8 9 - 5 .8 3 -4 ,7 8 1 3 .3 2 .2 0 3 .1 6 8 .9 2 ■ -5 .7 6 -4,723 3 .4 2.27 3.26. - 8 .9 4 - 5 .6 8 -4 ,6 5 8 3 .5 2 .3 3 - 3 .3 4 8.96 -5.62 -4,608 3.6 2.40 3.44 8.99 --5.55 -4 ,5 5 1 3 .7 2 .4 7 3.54 9 .0 1 - 5 .4 7 -4,485 3 .8 2.53 3.63 ' 9.03 - 5 .4 0 -4,428 3 .9 2.60 3 .7 3 9.06 -5.33 -4,371 4 .0 2 .6 7 3 .8 3 9.08 -5.25 -4,305 4 .1 2 .7 3 3 .9 2 9.10 -5.18- -4 ,2 4 8 4 .2 2.80 4 .0 2 9.13 ■ -5.-11 ' -4,190 4 .3 2.87 4.12 9.15 -5.03 -4,125 4 .4 - 2 .9 3 4 .2 0 9.17 -4.97 -4 ,0 7 5 4 .5 3 .0 0 4 .3 0 9.19 -4.89 -4 ,0 1 0 4.6 3.07 4.40 9.21 -4.81 -3,944 4 .7 3 .1 3 4.49 9.23 - 4 .7 4 -3,887 4 .8 3 .2 0 4.59 9.25 - 4 .6 6 -3,821 4.9 3.27 4.69 9.27 -4.58 -3 ,7 5 6 5 .0 3.33 4 .7 8 9.29 -4 .5 1 -3,698 5.1 3 .4 0 4.88 . 9.31 -4.43 -3,633 5.2 3.47 4.98 9.33 - 4 .3 5 - 3 ,5 6 7 5 .3 3.53 5.06 9.35 - 4 .2 9 -3,518 5 .4 3 .6 0 5 .1 7 9.37 - 4 .2 0 -3 ,4 4 4 • Sl/ See f o o tn o te a t th e end o f T a b le . b / See f o o tn o te a t th e end of, T a b le . V s e e fo o tn o te a t t h e end o f T a b le . - 8 3 - TABLE I I I , APPENDIX B . FARM UNIT NET CASH LOSS OR PROFIT AT VARIOUS YIELD'LEVELS. IN THE WINTER WHEAT AREA. Farm Y ie ld Farm U n it Y ie ld • . . Farm U n it G ross Income. Farm IJn it Expense ■ Farm U n it Loss o r P r o f i t Farm U n it Loss o r P r o f i t Eu. ■ | u . ' a / ■Dol.b / D o l .b / D o l .b / D o I. e / 5 .5 3 .6 7 5 .2 7 9 .3 9 - 4 .1 2 -3 ,3 7 8 5 .6 3 .7 3 5 .3 5 9 .4 0 -4 .0 5 -3 ,3 2 1 5 .7 3 .8 0 5 .4 5 9 .4 2 - 3 .9 7 -3 ,2 5 5 5 .8 3 .8 7 5 .5 5 9 .4 4 - 3 .8 9 -3 ,1 9 0 5 .9 3 .9 3 5 .6 4 9 .4 6 - 3 .8 2 . - 3 ,1 3 2 6 .0 4 .0 0 5 .7 4 9.48= - 3 ,7 4 . - 3 ,0 6 7 6 .1 4 .0 7 5 .8 4 9 .5 0 - 3 .6 6 -3 ,0 0 1 6 .2 4 .1 3 5 .9 3 9 .5 2 -3 .5 9 - 2 ,9 4 4 ' 6 .3 4 .2 0 6 .0 3 9 .5 4 -3 ,5 1 -2 ,8 7 8 6 .4 4 .2 7 ■ ■ 6 .1 3 9 .5 6 - 3 .4 3 ■ -2 ,8 1 3 . 6 .5 4 .3 3 6 ,2 1 9 .5 8 - 3 .3 7 -2 ,7 6 3 6 .6 4 .4 0 6 .3 1 9 .6 0 -3 .2 9 -2 ,6 9 8 6 .7 4 .4 7 - 1 6 .4 1 9 .6 2 -3 .2 1 -2 ,6 3 2 6 .8 ■ 4 .5 3 6 .5 0 9 .6 3 - 3 .1 3 -2 ,5 6 7 6 .9 4 .6 0 6 .6 0 9 .6 5 -3 .0 5 -2 ,5 0 1 7 .0 4 .6 7 6 .7 0 9 .6 6 - 2 .9 6 - 2 ,4 2 7 7 .1 4 .7 3 6 .7 9 9 .6 7 - 2 .8 8 -2 ,3 6 2 7 .2 4 .8 0 6 .8 9 9 .6 8 - 2 .7 9 -2 ,2 8 8 7 .3 4 .8 7 . 6 .9 9 9 .7 0 -2 .7 1 . - 2 ,2 2 2 7 .4 4 .9 3 7 .0 7 ' 9 .7 1 - 2 .6 4 -2 ,1 6 5 7 .5 5 .0 0 7 .1 7 ' 9 ,7 2 -2 .5 5 '- 2 ,0 9 1 7 .6 5 .0 7 7 .2 7 9 .7 3 - 2 .4 6 -2 ,0 1 7 7 .7 5 .1 3 7 .3 6 9 .7 5 -2 .3 9 -1 ,9 6 0 . 7 .8 5 .2 0 7 .4 6 9 .7 6 - 2 .3 0 -1 ,8 8 6 7 .9 5 .2 7 7 .5 6 9 .7 7 V -2 .2 1 - 1 ,8 1 2 8 .0 5 .3 3 . 7 .6 5 9 .7 8 42.13 -1 ,7 4 7 . 8 .1 ■5.40 7 .7 5 . 9 .8 0 ■ -2 '.0 5 -1 ,6 8 1 8 .2 / 5 . 4 7 7 .8 5 9 .8 1 - 1 .9 6 -1 ,6 0 7 8 .3 5 .5 3 7 .9 3 9 .8 2 -1 .8 9 -1 ,5 5 0 8 .4 5 .6 0 8 .0 3 9 .8 3 - 1 .8 0 -1 ,4 7 6 8 .5 5 .6 7 8 .1 4 9 .8 5 -1 .7 1 -1 ,4 0 2 8 .6 5 .7 3 8 .2 2 9 ,8 6 -1 .6 4 -1 ,3 4 5 8 .7 5 .8 0 8 .3 2 4 .8 7 -1 .5 5 -1 ,2 7 1 8 .8 5 .8 7 8 .4 2 9 .8 9 -1 .4 7 -1 ,2 0 5 8 .9 5 .9 3 8 .5 1 9 .9 0 -1 .3 9 -1 ,1 4 0 9 .0 6 .0 0 8 .6 1 . 9 .9 1 - 1 .3 0 -1 ,0 6 6 a / See f o o tn o te ,a t t h e ehd o f T a b le . b / See., f o o tn o te at., t h e end o f T ab lev See f o o tn o te a t th e enc( o f T a b le . - 8 4 -■ TABLE I I I , APPENDIX B . ( C o n t i n u e d ) . FARM UNIT NET CASH LOSS OR PROFIT ' ' .AT VARIOUS YIELD ...LEVELS IN THE WINTER WHEAT AREA. Farm Y ie ld Farm U n it Y ie ld Farm Unit- G ross Tnnnme . Farm U n it . Expense Farm U n it Loss o r ' P r o f i t Farm U n it Loss o r P r o f i t . , Eu. B u .a / Dol . 6 / D o l .b / D o l .b / Dbl .£ / 9 .1 6 .0 7 ■ 8 .7 1 9.92 -1.21 - 992 9.2 6 .1 3 8 .8 0 9.94 - 1 .1 4 - 935 9.3 6 .2 0 8.90 9.95 - 1 .0 5 - 861 9 .4 6 .2 7 9,00 9.96 - .9 6 - 787 9 .5 6,33 9 .0 8 9 .9 7 - .8 9 - 730 9.6 6 .4 0 9 .1 8 9.99 - .81 - 664 9 .7 ■ 6 ,4 7 9.28 9 i3 7 10 .00 - .7 2 - 590 9.8 6 .5 3 ' 10 .01 - .6 4 - 525 9*9 6 ,6 0 9.47 10 .02 - .55 - 451 1 0 .0 '6 ,67 9.57 10 .0 4 - .4 7 - 385 10 .1 6*73 ' 9.66 10*05 - .39 - 320 1 0 .2 6 .8 0 9.76 10 ,06 - .3 0 - 246 1 0 .3 ' 6 .8 7 9.86 1 0 .0 7 - .21 - 172 10,4 6.93 9.94 10 .08 - .1 4 - 115 10.5 7 .0 0 1 0 .0 4 10 .1 0 - .0 6 49 10 ,6 7 .0 7 1 0 .1 4 10 .11 + .0 3 + 25 ^ The farm u n i t y i e l d i s two t h i r d s o f th e farm y i e l d . ^ O p e ra to r s incom e, p e r se ed ed a c r e . e x p en se , and lo s s o r p r o f i t a r e in te rm s o f d o l l a r s C / . . . —' O p e ra to r l o s s o r p r o f i t i n t h i s column was c a lc u la t e d by m u l t ip ly in g th e o p e r a to r l o s s o r p r o f i t p e r seed ed a c re by th e number o f seeded a c r e s (8 2 0 ) . / 85 - TABLE IV , APPENDIX B. DOLLAR RESERVE REQUIREMENTS- FOR SURVIVAL IN THE SHORT RUN FOR VARIOUS YIELD COMBINATIONS, SPRING WHEAT AREA. T h re e -y e a r Y ie ld C om bination V R e se rv e s R eq u ire d Y ear One R e se rv e s . ■ R eq u ired Y ear Two -R e s e rv e s . , R equ ired Year T h ree R e se rv e s R equ ired Y ea rs One and Two R e se rv e s R eq u ired Y ea rs-O ne , Two and T h ree P o l . P o l . P o l . P o l . P o l . 111 6 ,7 2 4 6 ,7 2 4 6 ,7 2 4 13 ,448 20 ,172 112 6 ,7 2 4 6 ,7 2 4 4 ,3 4 9 13 ,448 17 ,797 113 6 ,7 2 4 6 ,7 2 4 2 ,1 7 4 13 ,448 15 ,622 114 6 ,7 2 4 6 ,7 2 4 0 1 3 ,4 4 8 ' 1 3 ,448 121 6 ,7 2 4 4 ,3 4 9 6 ,7 2 4 11 ,073 17 ,797 ' 122 6 ,7 2 4 4 ,3 4 9 4 ,3 4 9 11 ,073 15 ,422 123 6 ,7 2 4 4 ,3 49 2 ,174 . 11 ,073 13 ,247 124 6 ,7 2 4 4 ,3 4 9 0 11 ,073 11 ,073 131 6 ,7 2 4 2 ,1 74 6 ,7 2 4 8 ,898 1 5 ,6 2 2 132 6 ,7 2 4 2 ,1 7 4 4 ,3 4 9 8 ,8 9 8 13 ,247 133 6 ,7 2 4 2 ,1 7 4 - 2 ,1 7 4 8 ,8 98 1 1 ,0 7 2 . 134 6 ,7 2 4 2 ,1 74 0 8 ,8 98 8 ,8 9 8 -141 6,%24 0 6 ,7 2 4 6 ,7 2 4 13 ,448 142 6 ,7 2 4 . . O 4 ,3 4 9 6 ,7 2 4 11 ,073 143 6 ,7 2 4 0 2 ,1 74 6 ,7 2 4 8,89.8 144 ■ 6 ,7 2 4 0 0 6 ,7 2 4 6 ,7 2 4 211 4 ,3 4 9 6 ,7 2 4 6 ,7 2 4 11 ,073 17 ,797 212 4 ,3 4 9 6 ,7 2 4 ' 4 ,3 4 9 11 ,073 15 ,422 213 4 ,3 4 9 6 ,7 2 4 2 ,1 7 4 11 ,073 13 ,247 214 4 ,3 4 9 6 ,7 2 4 0 11 ,073 11 ,073 221 4 ,3 4 9 4 ,3 4 9 6 ,7 2 4 8 ,6 98 1 5 ,4 22 222 4 ,3 4 9 4 ,3 4 9 4 ,3 4 9 8 ,6 98 1 3 ,0 47 223 4 ,3 4 9 4 ,3 4 9 2 ,1 7 4 8 ,6 98 1 0 ,8 72 224 4 ,3 4 9 4*349 ' 0 ' 8 ,6 9 8 8 ,6 9 8 231 4 ,3 4 9 2 ,1 74 6 ,7 2 4 6 ,5 23 13 ,247 232 4 ,3 4 9 2 ,174 4 ,3 4 9 6 ,5 23 • 1 0 ,872 233 4 ,3 4 9 2 ,1 74 2 ,1 7 4 6 ,5 2 3 8 ,6 9 7 ■ 234 4 ,3 4 9 2 ,1 74 0 6 ,5 2 3 6 ,5 2 3 241 4 ,3 4 9 0 6 ,7 2 4 4 ,3 4 9 11 ,0 73 ■242 - 4 ,3 4 9 0 4 ,3 4 9 4 ,3 4 9 8 ,6 9 8 243 4 ,3 4 9 O 2 ,1 7 4 4 ,3 4 9 6 ,5 2 3 244 4 ,3 4 9 0 0 4 ,3 4 9 . 4 ,3 4 9 See f o o tn o te a t th e end o f T a b le . «■ 8 6 TABLE IV , APPENDIX .B. . (C o n t in u e d ) . DOLLAR RESERVE REQUIREMENTS FOR SURVIVAL IN THE SHORT RUN FOR VARIOUS YIELD- COMBINATIONS, ■ SPRING. WHEAT AREA. T h re e -y e a r Y ie ld C om bination a/ R ese rv e s R equ ired Y ear One R e se rv e s R eq u ired Y ear Two R e se rv e s R eq u ire d Y ear T h ree R e se rv e s R equ ired Y ears One and Two R e se rv e s R equ ired Y ea rs One, Two and Three P o l . P o l . P o l . P o l . P o l . 311 2 ,1 7 4 6 ,7 2 4 6 ,7 2 4 8,89.8 15 ,622 312 2 ,1 7 4 6 ,7 2 4 4 ,3 4 9 8 ,8 98 13 ,247 313 ■ 2 ,1 7 4 6 ,7 2 4 2,174 8 ,8 98 11 ,0 72 314 2 ,1 7 4 6 ,7 2 4 0 8 ,898 . 8 ,8 9 8 321 2 ,1 7 4 4 ,3 4 9 6 ,7 2 4 6 ,523 . 13 ,247 322 2 ,1 74 4 ,3 4 9 4,349 6 ,5 23 10 ,872 323 2 ,1 7 4 4 ,3 4 9 2 ,174 6 ,5 23 8,697 324 2 ,1 7 4 4 ,3 4 9 0 6 ,5 23 6 ,5 23 331 2,174 2 ,174 6 ,7 2 4 4 ,3 4 8 11 ,072 332 2 ,1 7 4 2 ,1 74 4 ,3 4 9 4 ,3 48 8,697 333 2 ,1 7 4 2,174 2 ,1 74 4,348 6 ,5 2 2 334 . 2 ,1 7 4 2 ,1 7 4 0 4 ,3 48 4 ,3 4 8 341 2 ,1 7 4 ■ 0 6,724 2 ,1 74 8 ,8 98 342 2 ,1 7 4 0 4 ,3 4 9 2,174 6 ,5 2 3 343 2,174 0 2 ,1 7 4 2 ,174 4 ,3 4 8 344. 2 ,1 7 4 0 0 2 ,174 2 ,1 74 411 0 6,724 6,724 6,724 13 ,448 412 0 6 ,7 2 4 .4 ,3 4 9 6 ,7 2 4 11 ,073 413 0 6 ,7 2 4 2,174 6 ,724 . 8,898 414 0 6,724 0 6,724 6,724 421 0 4,-349 6 ,7 2 4 4 ,3 4 9 ' 1 1 ,073 422 0 4 ,3 4 9 4,349 4 ,3 4 9 8,698 423 0 4,349 2 ,174 4,349 . 6 ,5 2 3 424 0 4,349 0 4,349 4,349 431 0 2 ,1 74 6,724 2 ,1 74 8 ,8 98 432 0 2 ,174 - 4 ,3 4 9 2 ,174 6 ,5 23 433 0 2,174 2,174 . 2 ,1 74 4 ,3 4 8 434 0 2 ,1 74 0 2 ,174 2,174 441 0 0 6 ,7 2 4 0 6,724 442 0 0 4 ,3 4 9 0 4,349 443 0 ■ 0 2 ,1 7 4 0 2 ,1 7 4 444 ■ 0 0 0 0 0 ,The farm y i e l d s a s s o c i a te d w ith th e n um era ls in t h i s column a r e : 1 = 0 b u s h e ls ; 2 = 3 .1 to 3 .2 b u s h e ls ; 3 = 6 .0 to 6 .1 b u s h e ls ; 4 = 8 .8 b u s h e ls p e r seed ed a c r e . At th e 8 .8 b u sh e l y i e l d income to th e farm u n i t c o v e rs th e c a sh e x p en se s o f th e f irm and h o u se ­ h o ld . The f i r s t d i g i t in t h i s column i s th e y e a r one y i e l d , th e second d i g i t i s th e y e a r two y i e l d , and th e . t h i r d d i g i t i s th e y e a r t h r e e y i e l d . .8 7 - TABLE V5 APPENDIX B. DOLLAR RESERVE REQUIREMENTS FOR SURVIVAL 'IN THE SHORT RUN FQR VARIOUS YIELD COMBINATIONS 5 WINTER , wheat Area , T h re e -y e a r Y ie ld R e se rv e s R e se rv e s R e se rv e s R e se rv e s ' R equ ired R e se rv e s R eq u ired C om b ina tion SJ Required ; R equ ired ' R eq u ire d Y ears One Y ears One, Y ea r One Y ear Two Year T h ree and Two Two and T h ree D o l. P o l . P o l . D o l. Dol o 111 6 ,7 6 5 6 ,765 6 ,7 6 5 13 ,530 20 ,295 112 6 ,7 6 5 6 ,7 65 4 ,4 0 5 13 ,530 17 ,935 113 6 ,7 6 5 6 ,7 6 5 2 ,2 0 3 13 ,530 15 ,733 114 6 ,7 6 5 6 ,7 6 5 0 13 ,530 13 ,530 121 6 ,7 6 5 4 ,4 0 5 6 ,7 6 5 11 ,170 17 ,935 122 6 ,7 6 5 4 ,4 0 5 4 ,4 0 5 11 ,170 15 ,575 123 6 ,7 6 5 4 ,4 05 2 ,2 0 3 11 ,170 13 ,373 124 6 ,7 6 5 4 ,4 05 0 11 ,170 11 ,170 131 6 ,7 6 5 2*203 6 ,7 65 8 ,9 6 8 15 ,733 132 6 ,7 6 5 2 ,2 0 3 4 ,4 0 5 8 ,9 6 8 . 13 ,373 133 6 ,7 6 5 2 ,2 0 3 2 ,2 0 3 8 ,9 6 8 11 ,171 134 6 ,7 6 5 2 ,2 0 3 0 " 8 ,9 6 8 8 ,9 6 8 - 141 6 ,7 6 5 0 6 ,7 6 5 6 ,7 6 5 13 ,530 142 6 ,7 6 5 0 4 ,4 0 5 6 ,7 6 5 11 ,170 143 6 ,7 6 5 0 2 ,2 0 3 6 ,7 6 5 8 ,9 6 8 • 144 6 ,7 6 5 0 0 6 ,7 6 5 6 ,765 211 4 ,4 0 5 6 ,7 65 6 ,7 6 5 11 ,170 17 ,935 212 4*405 • 6 ,7 6 5 4 ,4 0 5 11 ,170 15 ,575 213 4 ,4 0 5 6 ,7 6 5 2 ,2 0 3 11 ,170 13 ,373 214 4 ,4 0 5 6 ,7 65 0 11 ,170 11 ,170 221 . 4 ,4 0 5 4 ,405 ' 6 ,7 6 5 8 ,8 1 0 15 ,575 222 4 ,4 0 5 4 ,4 05 4 ,4 0 5 8 ,8 1 0 13 ,215 223 ' 4 ,4 0 5 4 ,4 05 2 ,2 0 3 8 ,8 1 0 11 ,013 224 4 ,4 0 5 . 4 ,4 0 5 0 8 ,8 1 0 8 ,8 1 0 231 4 ,4 0 5 2 ,2 0 3 6 ,7 6 5 6 ,6 0 8 13 ,373 232 4 ,4 0 5 '' 2 ,2 0 3 4 ,4 0 5 6 ,6 08 11 ,013 233 4 ,4 0 5 2 ,2 0 3 2 ,2 0 3 6 ,6 08 8 ,8 11 234 4 ,4 0 5 2 ,2 0 3 0-. 6 ,6 0 8 6 ,6 08 241 4 ,4 0 5 0 6 ,7 65 4 ,405 11 ,170 242 4 ,4 0 5 • 0 . 4 ,4 0 5 4 ,4 0 5 8 ,8 1 0 243 4 ,4 0 5 0 2 ,2 0 3 4 ,4 05 6 ,6 0 8 244 4 ,4 0 5 0 0 4 ,4 05 4 ,4 0 5 311 2 ,2 0 3 6 ,7 65 '6 ,7 6 5 8 ,9 6 8 15 ,733 312 2 ,2 0 3 6 ,765 - 6 ,7 6 5 8 ,9 6 8 13 ,373 313 2 ,2 0 3 6 ,7 65 2 ,2 0 3 8 ,9 6 8 11,171. s / See f o o tn o te a t th e end o f T a b le . - 88 - TABLE V, APPENDIX B. |(C o n tin u e d ) 6 DOLLAR RESERVE REQUIREMENTS FOR SUR­ VIVAL IN THE SHORT RUN FOR VARIOUS YIELD COMBINA- - - . TIONS, WINTER WHEAT AREA. T h re e -y e a r ' Y ie ld C om b ina tion i / . R e s e rv e s • R eq u ire d Y ear One 1 R e se rv e s R equ ired Y ear Two P o l . Dol.. 314 2 ,2 0 3 6 ,7 65 321 2 ,2 0 3 4 ,4 0 5 322 2 ,2 0 3 4 ,405 323 2 ,2 0 3 4 ,4 05 324 2 ,2 0 3 4 ,4 05 331 2 ,2 0 3 2 ,2 0 3 332 2 ,2 0 3 2 ,2 0 3 333 2 ,2 0 3 2 ,2 0 3 334 2 ,203- 2 ,2 0 3 341 2 ,2 0 3 0 342 2 ,2 0 3 0 343 2 ,2 0 3 0 344 2 ,2 0 3 0 411 0 6 ,7 6 5 412 • 0 6 ,7 6 5 413 0 6 ,7 65 414 o ■ 6 ,7 65 ’ 421 0 4 ,4 0 5 422 0 4 ,4 0 5 423 0 4 ,4 0 5 424 0 4 ,4 05 431 0 2 ,2 0 3 432 0 2 ,2 0 3 433 0 2 ,2 0 3 434 0 2 ,2 0 3 441 ■o 0 442 0 Q 443 0 0 444 0 0 R e se rv e s R equ ired .Y ear T h ree R e se rv e s R equ ired Y ears One •and Two R ese rv e s R equ ired Y ears One Two .and Th: Dol- D o l . ' D ol- • 0 8 ,9 6 8 8 ,9 6 8 6 ,7 65 6 ,6 0 8 13 ,373 4 ,4 05 .6 ,608 11 ,013 2 ,2 0 3 6 ,6 0 8 . 8 ,8 11 0 6 ,6 0 8 6 ,6 0 8 6 ,7 65 4 ,4 06 11 ,171 4 ,4 05 4 ,4 0 6 8 ,811 2 ,2 0 3 4 ,4 0 6 6 ,6 09 0 4 ,4 06 4 ,4 06 6 ,7 6 5 2 ,2 0 3 8 ,9 6 8 4 ,4 0 5 2,2Q3 6 ,6 0 8 2 ,2 0 3 2 ,2 0 3 4 ,4 0 6 0 , 2 ,2 0 3 2 ,2 0 3 . 6 ,7 6 5 6 ,7 65 13 ,530 4 ,4 0 5 6 ,7 65 11 ,170 2 ,2 0 3 6 ,7 65 8*968 0 6 ,7 6 5 6 ,7 6 5 6 ,765 4 ,4 0 5 11 ,170 4 ,4 0 5 ' 4 ,4 0 5 8 ,8 1 0 2 ,2 0 3 4 ,4 05 6 ,6 0 8 0 4 ,4 05 4 ,4 05 6 ,7 65 2 ,2 0 3 8 ,9 68 . 4 ,4 0 5 2 ,2 0 3 6 ,6 08 2 ,2 0 3 2 ,2 0 3 4 ,4 0 6 0 2 ,2 0 3 2 ,2 0 3 6 ,7 65 0 6 ,7 65 ' 4 ,4 0 5 0 4 ,4 0 5 2 ,2 0 3 0 • 2 ,2 0 3 0 . 0 0 i / The farm y i e l d s a s s o c i a te d w ith t h e num era ls a re s 1 = 0 b u s h e ls ; 2 = 3 .8 to 3 .9 b u s h e ls ; 3 = 7 .3 t o 7 .4 b u sh e ls '; 4 - 1 0 .5 b u s h e ls p e r se ed ed a c r e . A t th e 1 0 .5 .b u s h e l - y ie l d income, to th e farm u n i t c o v e rs th e c a sh e x p en se s o f th e f i rm and hou seho ld ,. The f i r s t d i g i t i n t h i s column i s th e y e a r oti'e y i e l d , th e second d i g i t . i s t h e y e a r two y i e l d , and th e t h i r d d i g i t i s th e y e a r t h r e e y i e l d . ** 8 9 =* TABLE I , APPENDIX C, MAXIMUM RESERVES, IN DOLLARS, REQUIRED AT ANY ONE TIME FOR SURVIVAL UNDER SHORT RUN CONDITIONS FOR EACH YIELD SERIES, SPRING WHEAT AREA. Y ie ld S e r ie s Y ea rs o f D ata Average Y ie ld ' S tan d a rd D e v ia tio n . C o e f f i c i e n t o f V a r ia t io n Max. R ese rv e s R equ ired fo r S u rv iv a l No. Y rs = Bu= Bu. \ P e t . D o l. I 15 1 7 .5 6 .3 0 3 6 .0 472 20 19 1 7 .3 7.22 4 1 .7 3,436 9 17 17 .1 6 .9 0 4 0 .3 6,724 '27 19 1 5 .7 6 .4 3 40.9 3,296 19 17 15 .1 7 .1 4 . 4 7 .3 5,384 26 17 15 .1 6 .7 3 4 4 .6 2,304 21 17 14.9 6 .4 0 42.9 6,724 22 19 1 4 .6 5 .5 7 38 .1 3,830 29 . 16 1 4 .5 6 .9 3 47.8 3,375 24 19 1 4 .4 6 .7 6 4 6 .9 8 ,1 1 7 Average 1 7 .5 1 5 .6 6 .6 4 42.65 (4 2 .5 6 ) 4,366 16 19 1 4 .0 . 7 .1 3 50.9 6,346 15 18 1 3 .9 6 .3 2 4 5 .5 ' 6,724 10 16 13.8 6.19 4 4 .8 2,148 3 17 1 3 .8 6 .1 6 4 4 .6 5,286 2 18 • 1 3 .7 5.39 39.3 4,334 8 17 1 3 .4 7.49 55.9 4,838 30 15 1 3 .2 6.89 5 2 .2 6,724 4 V 16 1 2 .8 5 .7 4 4 4 .8 5,234 18 18 1 2 .4 6.20 50.0 6,724 6 17 1 1 .9 6.12 5 1 .4 6,724 Average 17 .1 1 3 .3 6 .3 6 47.94 (4 7 .8 2 ) 5,508 7 17 11 .8 6 .6 3 56.2 5,837 25 17 1 1 .7 7.73 66 .1 9,909 14 19 1 1 .5 5 .7 5 50.0 4 , 590. 13 21 1 1 .4 7 .0 3 6 1 .7 15,970 12 19 1 1 .2 7 .2 6 64.8 9,577 17 19 1 1 .2 • 4 .3 8 39 .1 4,588 11 17 11 .1 5 .4 3 48.9 8,241 ' 5 17 9 .7 5.77 59.5 13,171 28 17 8 .5 3.73 43.9 11,201 23 17 . 6 .2 3 .0 1 4 8 .5 35 ,550 Average A ll S e r ie s 18.9 1 0 .4 • 5.67 5 3 .8 7 (5 4 .5 2 ) 11, 953. Average 1 7 .5 13 .1 6.22 48.15 (4 7 .4 8 ) 7,276 - 90 - TABLE I I 9 APPENDIX C . MAXIMUM RESERVES, IN DOLLARS, REQUIRED AT ANY ONE TIME FOR SURVIVAL UNDER SHORT RUN CONDITIONS . FOR EACH YIELD SERIES, WINTER WHEAT AREA. Y ie ld S e r ie s Y ears o f D ata Average Y ie ld S tan d a rd D e v ia tio n C o e f f i c i e n t o f V a r ia t io n Max. R ese rv e s R eq u ired f o r S u rv iv a l No. YrSi. Bu. Eu. P e t . D o l. 4 18 29.3 10.15 34 .6 935 33- 19 2 1 .8 6 .6 7 3 0 .6 246 9 18 21 .0 . 9.48 4 5 .1 0 17 18 2 0 .9 8 .6 6 41.4 2,165 8 17 20.0 9.10 45.5 11,423 29 18 2 0 .0 4.67 23.3 0 28 18 1 9 .7 7.00 3 5 .5 1,402 6 20 19.5 7 .3 6 3 7 .7 4,781 31 20 19.0 7.68 4 0 .4 8,315 2 22 18 .8 9.48 50.4 9,709 24 ' • 18 17.9 8 .7 8 49.0 7,872 7 20 1 7 .8 9.67 5 4 .3 11 ,357 Average 18 .83 2 0 .5 8.225 4 0 .6 5 (4 0 .1 2 ) 4,850 18 16 1 7 .2 8.69 5 0 .5 11 ,310 27 16 1 7 .0 9.78 57.5 11,136 -21 18 16.8 8.75 5 2 .1 5,076 34 18 16.8 6 .4 1 38 .1 1 ,8 1 2 37 18 16.4 6.57 4 0 .1 6,765 22 19 1 6 .3 6.19 38.0 2 ,944 5 17 16.2 5 .11 3 1 .5 2,944 15 24 1 5 .8 9.54 60.4 26,552 16 . 19 1 5 .5 9.22 5 9 .5 7,929 35 ' 14 ' 14.9 5.27 35.4 ' 4,534 23 . 20 1 4 .5 6.44 4 4 .4 4,551 3 20 1 4 .4 5 .3 4 37 .1 11 ,144 14 20 14 .1 7 .0 8 . 5 0 .2 ' 6,765 Average 18 .38 15.8 7.26 45.75 (4 5 .9 5 ) 7,959 — 9 1 " TABLE I I 9 APPENDIX C. (Continued). MAXIMUM RESERVES, IN DOLLARS, REQUIRED AT ANY ONE TIME FOR SURVIVAL UNDER SHORT RUN CONDITIONS FOR EACH YIELD SERIES, WINTER ' WHEAT AREA. Y ie ld S e r ie s Y ears o f D ata Average Y ie ld S ta n d a rd D ev ia tio n C o e f f i c i e n t o f V a r ia t io n Max. R ese rv e s R eq u ire d f o r S u rv iv a l ■ No. Y rs . Bu o Eu. P e t . Do I . . I 19 13.4 7 .0 0 52.2 - 6,621 32 20 1 3 .4 5.62 4 1 .9 9,578 36 16 ' 1 3 .2 5.46 ' 41.4 4,723 25 16 1 2 .8 5.86- 4 5 .8 9,832 12 18 12.5 6.88 5 5 .0 ’ 11,455 26 18 1 1 .7 6 .2 4 5 3 .3 10,012 10 18 11 .6 6.69 5 7 .7 20,350 30 19 1 1 .4 3.89 34 .1 14,687 ' 13 17 1 0 .7 4.69 43.8 12,039 19 17 1 0 .6 . 6 .1 8 58.3 12,706 20. 19 9 .7 3 .0 5 31 = 4 ■ 13,270 ■ H 17 7 .0 . 3.86 55.1 41,061 Average O v e r - a l l 17.83 1 1 .5 5.45 4 7 .5 0 (4 7 .3 9 ) 13,861 Average 18.35 15 .9 6.99 44.66 (43 . 96) 8,865 t TABLE I I I . APPENDIX C . YIELD SERIES 1 9 , SPRING WHEAT AREA HIGH YIELD GROUP, CASH AND GRAIN RESERVES EQUIVALENT TO $ 6 ,7 2 4 AT THE BEGINNING THE OF PERIOD. Farm U n it F irm Farm G ro ss Expense Farm U n it Income Per Y ie ld Y ie ld P e r A cre Acre Eu. Bu. P o l . P o l . 7 .8 5 .8 5 0 8 .8 1 10 .9 1 2 4 .6 18 .4 5 0 2 7 .7 9 1 1 .9 0 1 0 .7 8 .0 2 5 12 .0 9 1 1 .2 0 2 5 .9 19 .425 2 9 .2 6 1 1 .9 6 1 9 .6 14 .700 2 2 .1 4 1 1 .6 5 1 4 .2 10 .650 16 .0 4 1 1 .3 8 1 1 .3 8 .4 75 12 .7 6 1 1 .2 3 1 3 .9 10 .425 1 5 .7 0 11 .3 6 8 .2 6 .1 5 0 9 .2 6 1 0 .9 7 2 .4 1 .8 0 0 2 .7 1 9 .8 3 1 5 .5 11 .625 17 .5 1 1 1 .4 4 9 .5 7 .1 2 5 1 0 .7 3 1 1 .1 4 1 4 .4 10 .800 1 6 .2 7 11 .3 9 2 6 .4 19 .800 2 9 .8 2 11 .9 9 1 3 .1 9 .8 2 5 1 4 .8 0 1 1 .3 2 2 8 .0 2 1 .0 0 0 3 1 .6 3 1 2 .0 7 1 1 .8 8 .8 5 0 1 3 .3 3 11 .2 6 7 .1 5 .3 2 5 8 .0 2 1 0 .8 0 9 .2 6 .9 0 0 10 .3 9 1 1 .1 2 C um u la tiv e T o ta l F irm N e t I n c . B e fo re I n c . T axes Cash R e se rv e f / Farm U n it N e t Cash Income Y e a r ly S u rp lu s P o l . P o l . P o l . - 1 ,7 2 2 - 792 0 1 3 ,0 3 0 1 1 ,8 5 7 11 ,065 730 1 ,6 6 0 1 ,6 6 0 1 4 ,1 8 6 1 2 ,7 1 3 12 ,7 1 3 8 ,6 0 2 8 ,4 3 9 8 ,4 3 9 3 ,8 2 1 4 ,5 7 4 4 ,5 7 4 1 ,2 5 5 2 ,1 8 5 2 ,1 8 5 3 ,5 5 9 4 ,3 6 9 4 ,3 6 9 - 1 ,4 0 2 472 0 - 5 ,8 3 8 - 4 ,9 0 8 0 4 ,9 7 7 5 ,4 9 2 112 - 336 594 594 4 ,0 0 2 4 ,7 1 1 4 ,7 1 1 14 ,6 21 12 ,9 39 1 2 ,9 3 9 2 ,8 5 4 3 ,7 8 4 3 ,7 8 4 16 ,0 3 9 14 ,0 58 1 4 ,0 5 8 1 ,6 9 7 2 ,6 2 7 2 ,6 2 7 - 2 ,2 8 0 - 1 ,3 5 0 0 - 599 331 0 8 3 ,8 3 0 G ra in R e se rv e b7 G r a i n R e se rv e c / Farm U n it N e t Cash Income Y e a r ly S u rp lu s Farm U n it N et Cash Income Y e a r ly S u rp lu s P o l . P o l . P o l . P o l . 792 0 792 0 11 ,271 11 ,271 11 ,271 11 ,271 1 ,6 6 0 1 ,6 6 0 1 ,6 6 0 1 ,6 6 0 12 ,7 1 3 12 ,713 1 2 ,7 1 3 1 2 ,7 1 3 8 ,4 3 9 8 ,4 3 9 8 ,4 3 9 8 ,4 3 9 4 ,5 7 4 4 ,5 7 4 4 ,5 7 4 4 ,5 7 4 2 ,1 8 5 2 ,1 8 5 2 ,1 8 5 2 ,1 8 5 4 ,3 6 9 4 ,3 6 9 4 ,3 6 9 4 ,3 6 9 472 0 - 472 0 - 4 ,9 0 8 0 - 4 ,9 0 8 0 527 527 3 ,8 3 0 3 ,8 3 0 594 594 594 594 4 ,7 1 1 4 ,7 11 3 ,8 3 0 3 ,8 3 0 12 ,9 39 12 ,939 11 ,445 1 1 ,4 4 5 3 ,7 8 4 3 .7 8 4 3 ,7 84 3 ,7 8 4 14 ,0 58 14 ,058 14 ,0 58 14 ,0 5 8 2 ,6 2 7 2 ,6 2 7 2 ,6 2 7 2 ,6 2 7 - 1 ,3 5 0 0 - 1 ,3 5 0 0 331 0 331 331 84 ,451 8 5 ,7 1 0 R e se rv e h e ld a s c a sh in t h e b a n k . A t t h e end o f t h e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 5 ,7 0 5 . b / R e se rv e h e ld a s g r a in i n s t o r a g e , r a p i d r e p la c em e n t . At t h e end o f t h e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 5 ,7 0 5 . c / R e s e r v e h e l d a s g r a i n i n s t o r a g e , r e p l a c e m e n t on h i g h y i e l d y e a r s . A t t h e en d o f t h e p e r i o d t h i s r e s e r v e h a s a v a l u e o f $ 5 ,3 7 4 . TABLE IV , APPENDIX C . YIELD SERIES THREE, SPRING WHEAT AREA MEAN YIELD GROUP, CASH AND GRAIN RESERVES EQUIVALENT TO $ 6 ,7 2 4 AT THE BEGINNING OF THE PERIOD Farm U n it F irm F irm Cash R e se rv e a / G ra in R ese rv e b / G ra in R eserv e c / Farm G ro ss E xpense N e t I n c . Farm U n it Farm U n it Farm U n it Farm U n it Income Per B e fo re N e t Cash Y e a r ly N et Cash Y ea r ly N et Cash Y ea r ly Y ie ld Y ie ld P e r A cre Acre I n c . T axes Income S u rp lu s Income S u rp lu s Income S u rp lu s Eu. Bu. D o l. P o l . P o l . P o l . P o l . P o l . P o l . P o l . P o l . 1 1 .8 8 .8 5 0 1 3 .3 3 1 1 .2 6 1 ,6 9 7 2 ,6 2 7 2 ,6 2 7 2 ,6 2 7 2 ,6 2 7 2 ,6 2 7 2 ,6 2 7 1 0 .1 7 .5 7 5 11 .4 1 1 1 .1 7 197 1 ,1 2 7 1 ,1 2 7 1 ,1 2 7 1 ,1 2 7 1 ,1 2 7 1 ,1 2 7 1 4 .3 10 .7 2 5 16 .1 5 1 1 .3 8 3 ,9 11 4 ,6 3 9 4 ,6 3 9 4 ,6 3 9 4 ,6 3 9 4 ,6 3 9 4 ,6 3 9 2 0 .0 1 5 .0 0 0 2 2 .5 9 1 1 .6 7 8 ,9 5 4 8 ,7 2 0 8 ,7 2 0 8 ,7 2 0 8 ,7 2 0 8 ,7 2 0 8 ,7 2 0 1 4 .0 10 .5 0 0 15 .8 1 1 1 .3 7 3 ,6 4 1 4 ,4 3 4 4 ,4 3 4 4 ,4 3 4 4 ,4 3 4 4 ,4 3 4 4 ,4 3 4 5 .1 3 .8 2 5 5 .7 6 1 0 .4 3 - 3 ,8 2 9 - 2 ,8 9 9 0 - 2 ,8 9 9 0 - 2 ,8 9 9 0 6 .2 4 .6 5 0 7 .0 0 1 0 .6 6 - 3 ,0 0 1 - 2 ,0 7 1 0 - 2 ,0 71 0 - 2 ,0 7 1 0 8 .4 6 .3 0 0 9 .4 9 1 1 .0 0 - 1 ,2 3 8 303 0 - 308 0 - 308 0 1 1 .8 8 .8 5 0 13 .3 3 11 .2 6 1 ,6 9 7 2 ,6 2 7 0 0 0 2 ,6 2 7 2 ,6 2 7 6 .9 5 .1 7 5 7 .7 9 1 0 .7 7 - 2 ,4 4 4 - 1 ,5 1 4 0 - 1 ,5 1 4 0 - 1 ,5 1 4 0 2 4 .1 18 .0 7 5 2 7 .2 2 1 1 .8 7 1 2 ,5 8 7 11 ,531 7 ,3 6 6 8 ,2 9 5 8 ,2 9 5 6 ,1 6 5 6 ,1 6 5 8 .7 6 .5 2 5 9 .8 3 11 .0 4 992 62 0 62 0 62 0 1 9 .4 1 4 .5 5 0 21 .91 1 1 .6 4 8 ,4 2 1 8 ,2 9 4 8 ,2 3 2 8 ,2 4 4 8 ,2 4 4 8 ,2 4 4 8 ,2 4 4 1 8 .9 14 .1 7 5 21 .3 5 11 .6 1 7 ,9 8 7 7 ,9 4 3 7 ,9 4 3 7 ,9 4 3 7 ,9 4 3 7 ,9 4 3 7 ,9 4 3 1 2 .8 9 .6 0 0 14 .4 6 11 .3 1 2 ,5 8 3 3 ,5 1 3 3 ,5 1 3 3 ,5 1 3 3 ,5 1 3 3 ,5 1 3 3 ,5 1 3 2 7 .4 2 0 .5 5 0 3 0 .9 5 12 .0 4 15 ,5 06 13 ,6 7 7 13 ,6 7 7 13 ,6 7 7 1 3 ,6 7 7 13 ,6 77 13 ,6 7 7 1 4 .0 1 0 .5 0 0 15 .8 1 1 1 .3 7 3 ,6 41 4 ,4 3 4 4 ,4 3 4 4 ,4 3 4 4 ,4 3 4 4 ,4 3 4 4 ,4 3 4 6 .6 4 .9 5 0 7 .4 6 1 0 .7 3 - 2 ,6 8 1 - 1 ,751 0 - 1 ,7 51 0 - 1 ,751 0 1 1 .9 8 .9 2 5 1 3 .4 4 11 .2 6 788 2 ,7 1 8 967 967 967 2 ,7 1 8 2 .7 1 8 C um u la tiv e T o ta l 6 7 ,6 7 9 68 ,6 2 0 70 ,8 68 i / R e se rv e h e ld a s c a s h in th e b an k , At t h e end o f th e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 6 ,7 2 4 . V R ese rv e h e ld a s g r a i n in s t o r a g e , r a p id r e p la c em e n t , At th e end o f th e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 6 ,7 2 4 . V R e se rv e h e ld a s g r a i n in s t o r a g e , r e p la c em e n t on h ig h y i e l d y e a r s . A t t h e end o f th e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 4 ,9 7 3 . TABLE V, APPENDIX C . YEILD SERIES 1 2 , SPRING WHEAT AREA LOW YIELD GROUP, CASH AND GRAIN RESERVES EQUIVALENT TO $ 1 0 ,0 8 6 AT THE BEGINNING OF THE PERIOD Farm Y ie ld Farm U n it Y ie ld Farm L kiit G ro ss Income P e r A cre F irm Expense Per Acre F irm N e t I n c . B e fo re I n c . T ax es Cash R e se rv e a / G ra in R e se rv e b / G ra in R e se rv e c / Farm U n it N e t Cash Income Y e a r ly S u rp lu s Farm U n it N e t Cash Income Y e a r ly S u rp lu s Farm U n it N et Cash Income Y e a r ly S u rp lu s E u . E u . P o l . P o l . M - P o l . P o l . P o l . P o l . P o l . P o l . 3 .0 2 .2 5 0 3 .3 9 9 .9 7 - 5 ,3 9 6 - 4 ,4 6 6 0 - 4 ,4 6 6 0 - 4 ,4 6 6 0 3 .1 2 .3 2 5 3 .5 0 9 .9 9 - 5 ,3 2 2 - 4 ,3 9 2 0 - 4 ,3 9 2 0 - 4 ,3 9 2 0 7 .9 5 .9 2 5 8 .9 2 1 0 .9 2 1 ,6 4 0 2 ,5 7 0 0 0 0 2 ,5 7 0 2 ,5 7 0 1 4 .7 11 .025 1 6 .6 0 1 1 .4 0 4 ,2 6 4 4 ,9 1 4 0 0 0 3 ,8 3 0 3 ,8 3 0 1 8 .7 14 .0 25 2 1 .1 2 1 1 .6 0 7 ,8 0 6 7 ,8 0 0 6 ,4 2 6 6 ,9 1 6 6 ,9 1 6 3 ,8 3 0 3 ,8 3 0 1 6 .2 1 2 .1 5 0 1 8 .3 0 1 1 .4 8 5 ,5 9 2 5 ,9 9 9 5 ,9 9 9 5 ,9 9 9 5 ,9 9 9 3 ,9 1 3 3 ,9 13 9 .8 7 .3 5 0 1 1 .0 7 1 1 .1 6 74 856 856 856 856 856 856 4 .2 3 .1 5 0 4 .7 4 10 .2 5 - 4 ,5 1 8 - 3 ,5 8 8 0 - 3 ,5 8 8 0 - 3 ,5 8 8 0 6 .5 4 .8 7 5 7 .3 4 10 .71 - 2 ,7 6 3 - 1 ,8 3 3 0 - 1 ,8 3 3 0 - 1 ,8 3 3 0 1 0 .1 7 .5 7 5 11 .4 1 1 1 .1 7 197 1 ,1 2 7 0 0 0 1 ,1 2 7 1 ,1 2 7 1 1 .8 8 .8 5 0 1 3 .3 3 11 .2 6 1 ,6 9 7 2 ,6 2 7 0 0 0 2 ,6 4 7 2 ,6 4 7 1 .3 0 0 9 .3 3 - 7 ,6 5 1 - 6 ,7 2 4 0 - 6 ,7 2 4 0 - 6 ,7 2 4 0 1 9 .0 1 4 ,2 5 0 2 1 .4 6 11 .6 2 8 ,0 6 9 8 ,0 1 0 0 608 008 3 ,8 3 0 3 ,8 3 0 1 3 .9 1 0 .4 2 5 1 5 .7 0 11 .3 6 3 ,5 5 9 4 ,3 6 9 3 ,9 8 8 4 ,3 6 9 4 ,3 6 9 3 ,8 3 0 3 ,8 3 0 1 4 .0 1 0 .5 0 0 15 .8 1 1 1 .3 7 3 ,6 4 1 4 ,4 3 4 4 ,4 3 4 4 ,4 3 4 4 ,4 3 4 3 ,8 3 0 3 ,8 3 0 2 4 .0 1 8 .0 0 0 2 7 .1 1 1 1 .8 7 1 2 ,4 9 7 1 1 ,4 9 7 11 ,4 6 4 11 ,4 6 4 11 ,4 64 7 ,0 8 6 7 ,0 8 6 0 0 0 9 .3 3 - 7 ,6 5 1 - 6 ,7 2 4 0 - 6 ,7 2 4 0 - 6 ,7 2 4 0 2 6 .1 19 .5 75 2 9 .4 8 1 1 .9 7 1 4 ,3 5 8 12 ,8 21 6 ,0 9 7 7 ,6 6 2 7 ,6 6 2 7 ,6 6 2 7 ,6 6 2 9 .2 6 .9 0 0 1 0 .3 9 1 1 .1 2 - 599 331 331 331 331 331 331 1 3 .7 10 .2 75 1 5 .4 8 11 .3 5 3 ,3 8 7 4 ,2 3 2 4 ,2 3 2 4 ,2 3 2 4 ,2 3 2 4 ,2 3 2 4 ,2 3 2 1 6 .4 1 2 .3 0 0 1 8 .5 3 1 1 .4 9 5 ,7 7 3 6 ,1 4 6 6 .1 4 6 6 ,1 4 6 6 .1 4 6 6 ,1 4 6 6 .1 4 6 C um u la tiv e T o ta l 4 9 ,9 7 3 5 3 ,0 1 7 55 ,7 2 0 5 / R e se rv e h e ld a s c a s h i n t h e b a n k . At t h e end o r t h e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 1 0 ,0 8 6 . R e se rv e h e ld a s g r a in in s t o r a g e , r a p i d r e p la c e m e n t , A t t h e end o f t h e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 1 0 ,0 8 6 . S J R e s e r v e h e l d a s g a a i n i n s t o r a g e , r e p l a c e m e n t o n h i g h y i e l d y e a r s . A t t h e en d o f t h e p e r i o d t h i s r e s e r v e h a s a v a l u e o f $ 1 0 ,0 8 6 . TABLE V I , APPENDIX C . YIELD SERIES S IX , SPRING WHEAT AREA HIGH YIELD GROUP, CASH AND GRAIN RESERVES EQUIVALENT TO $ 1 0 ,1 4 7 AT THE BEGINNING OF THE PERIOD. Farm U n it F irm F irm Cash R e se rv e a / G ra in R e se rv e b / G ra in R ese rv e c / Farm G ro ss E xpen se N e t I n c . Farm U n it Farm U n it Farm U n it Farm U n it Income Per B e fo re N e t Cash Y e a r ly N e t Cash Y e a r ly N et Cash Y e a r ly Y ie ld Y ie ld P e r Acre A cre I n c . T ax es Income S u rp lu s Income S u rp lu s Income S u rp lu s Bu . Bu. P o l . P o l . P o l . P o l . P o l . P o l . P o l . P o l . P o l . 3 .2 2 .1 3 3 3 .0 6 1 0 .9 7 - 6 ,4 8 6 - 4 ,7 7 9 0 - 4 ,7 7 9 0 - 4 ,7 7 9 0 1 7 .9 1 1 .9 3 3 1 7 .1 2 1 2 .5 5 3 ,7 4 7 5 ,2 9 4 515 675 675 4 ,6 0 7 4 ,6 0 7 1 1 .4 7 .6 0 0 1 0 .9 0 1 2 .2 3 - 1 ,0 9 1 616 616 616 616 6 ,2 1 5 616 9 .1 6 .0 6 7 8 .7 0 1 2 .0 0 - 2 ,7 0 6 - 999 0 - 999 0 5 ,2 1 6 0 1 9 .5 1 3 .0 0 0 1 8 .6 5 1 2 .6 3 4 ,9 3 6 6 ,2 3 8 5 ,2 3 9 5 ,4 3 9 5 ,4 3 9 4 ,6 0 7 4 ,6 0 7 3 0 .5 2 0 .3 3 3 2 9 .1 7 1 3 .1 8 1 3 ,1 1 2 1 2 ,6 0 2 1 2 ,6 0 2 1 2 ,6 0 2 12 ,6 0 2 10 ,506 10 ,506 1 9 .9 1 3 .2 6 7 1 9 .0 3 . 1 2 .6 5 5 ,2 3 2 6 ,4 8 0 6 ,4 8 0 6 ,4 8 0 6 ,4 8 0 6 ,4 8 0 6 ,4 8 0 1 8 .6 1 2 .4 0 0 1 7 .7 9 1 2 .5 9 4 ,2 6 4 5 ,6 9 1 5 ,6 9 1 5 ,6 9 1 5 ,6 9 1 5 ,6 9 1 5 ,6 91 2 5 .9 1 7 .2 6 7 2 4 .7 7 1 2 .9 5 9 ,6 9 2 1 0 ,0 9 0 1 0 ,0 9 0 1 0 ,0 9 0 1 0 ,0 9 0 1 0 ,0 9 0 10 ,0 90 1 4 .1 9 .4 0 0 1 3 .4 9 1 2 .4 0 894 2 ,6 0 1 2 ,6 0 1 2 ,6 0 1 2 ,6 0 1 2 ,6 0 1 2 ,6 01 1 5 .5 1 0 .3 3 3 1 4 .8 3 1 2 .4 3 1 ,9 6 8 3 ,6 7 5 3 ,6 7 5 3 ,6 7 5 3 ,6 7 5 3 ,6 75 3 ,6 7 5 2 7 .0 18 .0 0 0 2 5 .8 3 1 3 .0 1 10 ,5 21 1 0 ,7 4 3 1 0 ,7 4 3 1 0 ,7 4 3 1 0 ,7 4 3 10 ,7 43 10 ,7 43 2 0 .7 1 3 .8 0 0 1 9 .8 0 1 2 .6 9 5 ,8 3 0 6 ,9 7 0 6 ,9 7 0 6 ,9 7 0 6 ,9 7 0 6 ,9 7 0 6 ,9 7 0 1 4 .5 9 .6 6 7 1 3 .8 7 1 2 .3 8 1 ,2 2 2 2 ,9 2 9 2 ,9 2 9 2 ,9 2 9 2 ,9 2 9 2 ,9 2 9 2 ,9 2 9 2 2 .0 14 .6 6 7 2 1 .0 4 1 2 .7 6 6 ,7 9 0 7 ,7 5 7 7 ,7 5 7 7 ,7 5 7 7 ,7 5 7 7 ,7 5 7 7 ,7 57 1 8 .4 12 .2 6 7 1 7 .6 0 1 2 .5 8 4 ,1 1 6 5 ,5 8 3 5 ,5 8 3 5 ,5 8 3 5 ,5 8 3 5 ,5 8 3 5 ,5 8 3 2 2 .1 1 4 .7 3 3 2 1 .1 4 1 2 .7 6 6 ,8 7 2 7 ,8 2 4 7 ,8 2 4 7 ,8 2 4 7 ,8 2 4 7 ,8 2 4 7 ,8 2 4 3 6 .9 2 4 .6 0 0 3 5 .2 9 1 3 .5 0 1 7 ,8 6 8 16 ,1 16 16 ,1 16 1 6 ,1 1 6 16 ,116 16 ,1 16 16 ,116 1 7 .3 1 1 .5 3 3 16 .5 5 1 2 .5 2 3 ,3 0 5 4 ,9 7 4 4 ,9 7 4 4 ,9 7 4 4 ,9 7 4 4 ,9 7 4 4 ,9 7 4 2 4 .9 1 6 .0 0 0 2 3 .8 2 1 2 .9 0 8 ,9 5 4 9 ,4 9 7 9 ,4 9 7 9 ,4 9 7 9 ,4 9 7 9 ,4 9 7 9 ,4 9 7 3 6 .5 2 4 .3 3 3 34 .9 1 1 3 .4 8 1 7 ,5 7 3 15 ,9 09 15 ,909 1 5 ,9 0 9 15 ,9 09 15 ,909 15 ,909 3 4 .0 2 2 .6 6 7 3 2 .5 2 1 3 .3 6 15 ,7 11 14 ,601 14 .601 14 ,6 01 14 .601 14 ,601 14 .601 C um u la tiv e T o ta l 1 5 0 ,4 1 2 15 0 ,7 7 2 151 ,776 V R e se rv e h e ld a s c a s h i n t h e b a n k . A t t h e end o f t h e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 1 0 ,1 4 7 . b / R e se rv e h e ld a s g r a i n in s t o r a g e , r a p i d r e p la c e m e n t . A t t h e end o f t h e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 1 0 ,1 4 7 . c / R e s e r v e h e l d a s g r a i n i n s t o r a g e , r e p l a c e m e n t o n h i g h y i e l d y e a r s . A t t h e e n d o f t h e p e r i o d t h i s r e s e r v e h a s a v a l u e o f $ 1 0 ,1 4 7 . TABLE V I I , APPENDIX C . YIELD SERIES 1 6 , SHHNG WHEAT AREA MEAN YIELD GROUP, CASH AND GRAIN RESERVES EQUIVALENT TO $ 1 3 ,5 3 0 AT THE BEGINNING OF THE PERIOD. Farm U n it F irm F irm Cash R e se rv e a / G ra in R e se rv e b / G ra in R e se rv e b / Farm G ro ss Expense N e t I n c . Farm U n it Farm U n it Farm U n it Farm U n it Income Per B e fo re N et C ash Y e a r ly N et Cash Y e a r ly N et Cash Y e a r ly Y ie ld Y ie ld P er Acre Acre I n c . T axes Income S u rp lu s Income S u rp lu s Income S u rp lu s D e l . D o l. D o l. D o l. D o l. D o l. D o l. D o l. D o l. 5 .4 3 .6 0 0 5 .1 7 1 1 .4 5 - 5 ,1 5 0 - 3 ,4 4 3 0 - 3 ,4 4 3 0 - 3 ,4 4 3 0 3 .7 2 .4 6 7 3 .5 4 1 1 .0 9 - 6 ,1 9 1 - 4 ,4 8 4 0 - 4 ,4 8 4 0 - 4 ,4 8 4 0 1 4 .2 9 .4 6 7 1 3 .5 8 1 2 .3 7 992 2 ,6 9 9 0 0 0 2 ,699 2 ,6 9 9 2 0 .1 1 3 .4 0 0 1 9 .2 3 1 2 .6 6 5 ,3 8 7 6 ,6 0 8 1 ,3 8 0 1 ,8 6 6 1 ,8 6 6 4 ,6 0 7 4 ,6 0 7 2 0 .4 1 3 .6 0 0 19 .5 1 1 2 .6 8 5 ,6 0 1 6 ,7 8 4 6 ,7 8 4 6 ,7 8 4 6 ,7 8 4 4 ,6 0 7 4 ,6 0 7 3 1 .4 2 0 .9 3 3 3 0 .0 3 1 3 .2 3 13 ,7 7 6 1 3 ,1 8 6 13 ,1 8 6 1 3 ,1 8 6 13 ,1 86 11 ,1 44 11 ,144 3 3 .9 2 2 .6 0 0 3 2 .4 3 1 3 .3 5 1 5 ,6 4 6 1 4 ,5 5 5 14 ,5 55 1 4 ,5 5 5 14 ,5 55 14 ,555 14 ,555 1 1 .5 7 .6 6 7 1 1 .0 0 1 2 .2 3 - 1 ,0 0 9 698 698 698 698 698 698 7 .8 5 .2 0 0 7 .4 6 1 1 .8 4 - 3 ,5 9 2 - 1 ,8 8 5 0 - 1 ,8 8 5 0 - 1 ,8 85 0 1 0 .8 7 .2 0 0 1 0 .3 3 1 2 .2 0 - 1 ,5 3 3 174 0 0 0 174 174 2 .6 1 .7 3 3 2 .4 9 1 0 .8 3 - 6 ,8 3 9 - 5 ,1 3 2 0 - 5 ,1 3 2 0 - 5 ,1 3 2 0 3 0 .0 2 0 .0 0 0 2 8 .7 0 1 3 .1 6 1 2 ,7 4 3 1 2 ,4 2 3 5 ,5 8 0 7 ,0 2 6 7 ,0 2 6 6 ,8 91 6 ,8 9 1 1 2 .2 8 .1 3 3 1 1 .6 7 1 2 .2 7 - 492 1 ,2 1 5 1 ,2 1 5 1 ,2 1 5 1 ,2 1 5 1 ,215 1 ,2 1 5 9 .0 6 .0 0 0 8 .6 1 11 .9 9 - 2 ,7 7 2 - 1 ,0 6 5 0 - 1 ,0 6 5 0 - 1 ,0 65 0 7 .1 4 .7 3 3 6 .7 9 1 1 .7 5 - 4 ,0 6 7 - 2 ,3 6 0 0 - 2 ,3 6 0 0 - 2 ,3 6 0 0 1 4 .6 9 .7 3 3 1 3 .9 6 12 .3 9 1 ,2 8 7 2 ,9 9 4 0 0 0 2 ,9 9 4 2 ,9 9 4 2 2 .6 1 5 .0 6 7 2 1 .6 2 12 .7 9 7 ,2 4 1 8 ,1 2 3 7 ,6 9 2 7 ,7 7 3 7 ,7 7 3 5 ,3 4 7 5 ,3 4 7 2 4 .5 1 6 .3 3 3 2 3 .4 3 1 2 .8 8 8 ,6 5 1 9 ,2 5 5 9 ,2 5 5 9 ,2 5 5 9 ,2 5 5 9 ,2 5 5 9 ,2 5 5 1 2 .8 8 .5 3 3 1 2 .2 9 1 2 .3 0 49 1 ,6 5 8 1 ,6 5 8 1 ,6 5 8 1 ,6 5 8 1 ,6 58 1 ,6 58 1 1 .7 7 .8 0 0 1 1 .1 9 1 2 .2 4 - 861 846 846 846 846 846 846 2 5 .9 1 7 .2 6 7 C um u la tiv e T o ta l 2 4 .7 7 1 2 .9 5 9 ,6 9 2 1 0 ,0 9 0 1 0 .0 9 0 72*939 1 0 ,0 9 0 10 .0 90 74 *952 10 ,090 10 .090 76 ,780 R e se rv e h e ld a s c a s h i n t h e b a n k . At th e end o f th e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 1 0 , 147 . i / R e se rv e h e ld a s g r a i n i n s t o r a g e , r a p i d r e p la c em e n t . At t h e end o f t h e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 1 0 ,1 4 7 . £ / R e s e r v e h e l d a s g r a i n i n s t o r a g e , r e p l a c e m e n t o n h i g h y i e l d y e a r s . A t t h e e n d o f t h e p e r i o d t h i s r e s e r v e h a s a v a l u e o f $ 1 0 ,1 4 7 . TABLE V I I I , APPENDIX C . YEILD SERIES 1 9 , SPRING WHEAT AREA LOW YIELD GROUP, CASH AND GRAIN RESERVES EQUIVALENT TO $ 1 3 ,5 3 0 AT THE BEGINNING OF THE PERIOD. Farm U n it F irm F irm Cash R e se rv e a / G ra in R e se rv e b / G ra in R e se rv e c / Farm Farm U n it G ro ss Income E xpen se P er N e t I n c . B e fo re Farm L h i t N e t Cash Y e a r ly Farm U n it N e t Cash Y e a r ly Farm U h it N et Cash Y e a r ly Y ie ld Y ie ld P e r A cre A cre I n c . T axes Income S u rp lu s Income S u rp lu s Income S u rp lu s Bu . Bu. D o t. P o l . P o l . P o l . P o l . P o l . P o l . P o l . P o l . 8 .2 5 .4 6 7 7 .8 4 1 1 .8 9 - 3 ,3 2 1 - 1 ,6 1 4 0 - 1 ,6 1 4 0 - 1 ,6 1 4 0 1 1 .0 7 .3 3 3 1 0 .5 2 12 .2 1 - 1 ,3 8 6 321 0 0 0 321 321 7 .4 4 .9 3 3 7 .0 8 1 1 .7 9 - 3 ,8 6 2 - 2 ,1 5 5 0 - 2 ,1 5 5 0 - 2 ,1 5 5 O 8 .8 5 .8 6 7 8 .4 2 1 1 .9 7 - 2 ,9 1 1 - 1 ,2 0 4 0 - 1 ,2 0 4 0 - 1 ,2 04 0 1 0 .7 7 .1 3 3 1 0 .2 3 1 2 .1 9 - 1 ,6 0 7 100 0 0 0 100 100 1 2 .1 8 .0 6 7 1 1 .5 7 1 2 .2 6 - 566 1 ,1 41 0 0 0 1 ,1 41 1 ,1 41 2 1 .6 1 4 .4 0 0 2 0 .6 6 1 2 .7 4 6 ,4 9 4 7 ,5 1 5 4 ,1 0 4 4 ,7 5 8 4 ,7 5 8 4 ,6 0 7 4 ,6 0 7 5 .2 3 .4 6 7 4 .9 7 1 1 .4 1 - 5 ,2 8 1 - 3 ,5 7 4 0 - 3 ,5 7 4 0 - 3 ,5 7 4 0 1 1 .6 7 .7 3 3 11 .0 9 1 2 .2 4 - 943 764 0 0 0 764 764 2 9 .8 1 9 .8 6 7 2 8 .5 0 1 3 .1 5 1 2 ,5 8 7 1 2 ,3 0 8 9 ,4 9 8 1 0 ,1 5 7 1 0 ,1 5 7 9 ,3 2 7 9 ,3 2 7 3 .8 2 .5 3 3 3 .6 3 1 1 .1 1 - 6 ,1 3 4 - 4 ,4 2 7 0 - 4 ,4 2 7 0 - 4 ,4 2 7 0 7 .1 4 .7 3 3 6 .7 9 1 1 .7 5 - 4 ,0 6 7 - 2 ,3 6 0 0 - 2 ,3 6 0 0 - 2 ,3 6 0 0 1 2 .6 8 .4 0 0 1 2 .0 5 1 2 .2 9 - 197 1 ,5 1 0 0 0 0 1 ,5 1 0 1 ,5 1 0 6 .4 4 .2 6 7 6 .1 2 1 1 .6 4 - 4 ,5 2 6 - 2 ,8 1 9 0 - 2 ,8 1 9 0 - 2 ,8 1 9 0 1 0 .0 6 .6 6 7 9 .5 7 1 2 .1 2 - 2 ,0 9 1 384 0 - 384 0 - 384 0 9 .4 6 .2 6 7 8 .9 9 1 2 .0 4 - 2 ,5 0 1 794 0 794 0 - 794 0 5 .4 3 .6 0 0 5 .1 7 1 1 .4 5 - 5 ,1 5 0 - 3 ,4 4 3 0 - 3 ,4 4 3 0 - 3 ,4 4 3 0 1 8 .9 1 2 .6 0 0 1 8 .0 8 1 2 .6 0 4 ,4 9 4 5 ,8 9 0 0 0 0 4 ,6 0 7 4 ,6 0 7 2 4 .1 1 6 .0 6 7 2 3 .0 5 1 2 .8 6 8 ,3 5 6 9 ,0 1 9 2 .1 9 2 3 ,5 4 7 3 .5 4 7 4 ,6 0 7 4 .6 0 7 C um u la tiv e T o ta l 1 5 ,7 9 4 1 8 ,4 6 2 26 ,1 43 V R e se rv e h e ld a s c a s h i n t h e b a n k . A t t h e end o f t h e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 1 3 ,5 3 0 . V R e se rv e h e ld a s g r a i n i n s t o r a g e , r a p i d r e p la c e m e n t , A t t h e end o f t h e p e r io d t h i s r e s e r v e h a s a v a lu e o f $ 1 3 ,5 3 0 e / R e s e r v e h e l d a s g r a i n i n s t o r a g e , r e p l a c e m e n t o n h i g h y i e l d y e a r s . A t t h e e n d o f t h e p e r i o d t h i s r e s e r v e h a s a v a l u e o f $ 1 3 ,5 3 0 . TABLE IX , APPENDIX C . YEAR-TO-YEAR .NET WORTH OF A FARM UNIT REPRESENTED BY YIELD 'SER IES 1 9 , SPRING WHEAT AREA. Year L iq u id . R ese rv e® / ' Y ea r ly S u rp lu s V alue o f A s s e t s ^ / ■ S u rp lu s f o r In v e s tm en t V a lu e o f A s s e t s ^ / S u rp lu s f o r In v e s tm en t No. D o l. D o l. ■ D o l. P o l . ' D o l. 0 6 ,7 2 4 5,932 25 ,0 00 — — — 25 ,000 ---— I 0 '2 1 ,6 9 5 0 21 ,695 0 2 6 ,7 2 4 11 ,271 25 ,000 4 ,6 61 2 5 ,0 0 0 4 ,661 3 6 ,7 2 4 1 ,6 60 23,355 0 23 ,355 0 4 - 6,724 12 ,713 25 ,000 7 ,7 63 2 5 ,0 0 0 7 ,763 5 6 ,7 2 4 8,439 25 ,000 5 ,1 3 4 25 ,000 5 ,1 3 4 6 6 ,7 2 4 4,574 25 ,000 .1,269 2 5 ,0 0 0 1 ,269 7 6 , 7%4 2 ,185 : 23,880 0 23 ,8 80 0 8 6 ,7 2 4 4 ,3 69 24 ,9 44 0 2 4 ,9 4 4 0 , 9 6 ,2 5 2 0 21 ,639 0 21 ,639 0 10 I , '344 0 18 ,334 0 18 ,3 34 0 11 3 ,421 3 ,8 30 18 ,859 . 0 18 ,859 0 12 3 ,421 594 16 ,148 .0 16 ,148 0 13 4,523 3 ,8 3 0 16 ,673 0 17 ,483 0 14 6 ,7 2 4 11 ,445 24 ,8 13 0 21,625 3 ,1 8 8 . 15 6 ,7 2 4 3 ,7 8 4 25 ,000 292 19 ,150 16 ,675 • 2 ,.954 16 6 ,7 2 4 14 ,058 25 ,000 .10 ,753 13 ,228 • 17 6,724 2,627 24 ,3 22 0 . 14 ,200 1 ,797 18 5 ,3 7 4 0 2 1 ,0 1 7 0 10 ,895 , o 19 5 .3 7 4 331 18 .043 0 7.921 0 Ending. Inventoiy 5 ,3 7 4 ’ i . 18:,043 29 ,8 72 7,921 39 ,994 *. t a / The l i q u i d r e s e r v e i s h e ld as g r a in in s to r a g e w ith r e p la c em en t o n ly from h ig h y i e l d y e a r s . b / v a lu e o f t h e m ach in e ry , e q u ipm en t, and b u i ld in g s o f th e f irm and h o u s e h o ld . A f u l l d e p r e c i a t i o n c h a rg e i s s u b t r a c te d e ach y e a r . - / V a lu e o f t h e m a c h in e r y , e q u ip m e n t , and b u i l d i n g s o f t h e f i r m and . h o u s e h o l d . O n ly t h e d e p r e c i a t i o n c h a r g e f o r b u i l d i n g s and h o u s e h o ld e q u ip m e n t i s m ade i n t h e l a t e r y e a r s . - 99 - TABLE X , APPENDIX C. YEAR-TO-YEAR NET WORTH OF A.FARM UNIT REPRESENTED BY YIELD SERIES THREE, SPRING WHEAT AREA. . Y ear • L iq u id . R e s e rv e s ^ / Y ea r ly S u rp lu s V alue o f A s s e t s ^ / S u rp lu s f o r In v e s tm en t V a lu e o f A s s e t s ^ / S u rp lu s f o r In v e s tm en t No. P o l . D a i . - DoK D o l. D o l. D o l. 0 6 ,7 2 4 «——— 25 f 000 e * eei e e 25 ,000 I 6,724 2,627 24,322 0 24 ,322 0 2 6,724 1 ,1 2 7 22 ,1 44 0 2 2 ,1 4 4 0 3 6,724 4 ,6 3 9 ' 23 ,478 0 23 ,478 0 4 6 ,7 2 4 S', 720 25 ,000 3 ,8 9 3 2 5 ,0 00 3 ,8 93 5 6 ,7 2 4 4 ,4 3 4 2 5 ,0 0 0 1 ,129 25,000 1 ,129 ■ 6 3 ,8 25 0 21,695 0 21 ,695 0 7 1 ,7 5 4 0 18 ,390 0 18 ,390 0 8 1 ,446 0 15 ,085 0 15 ,085 0 9 " 1 ,4 46 2 ,6 2 7 14 ,407 0 1 4 ,4 07 0 10 - 68 0 11 ,102 0 11 ,102 0 11 6 ,7 2 4 6,165 13 ,962 0 13,962 0 12 6,662 0 10 ,657 0 . . 10,657 0 13 6 ,7 2 4 8 ,2 4 4 15,596 0 16 ,496 0 14 6 ,7 2 4 7 ,9 43 20 ,234 0 21 ,625 0 15 6 ,7 2 4 3 ,5 1 3 20 ,442 0 19 ,150 1,292 16 6 ,7 2 4 13 ,677 25 ,000 5 ,8 1 4 16 ,675 12 ,847 17. 6,724 4 ,4 3 4 25 ,000 1 ,129 14 ,200 3 ,604 18 6 ,7 2 4 0 21 ,695 0 10,895. 0 19 4 .9 7 3 2 .7 18 21 .108 ■ ■ 0 , ’ 9v250 1 ,058 Ending Inventory 4 ,9 7 3 - - - 21,108 11 ,965 9 ,2 5 0 23,823 2 / The l i q u i d r e s e r v e i s h e ld as g r a in in s to r a g e w ith re p la c em en t o n ly from h ig h y i e l d y e a r s . —' V a lue o f t h e m ach in e ry , eq u ipm en t, and b u i ld in g s o f th e f i rm and h o u s e h o ld . A f u l l d e p r e c i a t i o n c h a rg e i s s u b t r a c t e d each ' y e a r . 2 / V a lue o f th e m ach in e ry , equ ipm en t and b u i ld in g s o f th e f irm and h o u s e h o ld . Only th e d e p r e c ia t io n c h a rg e f o r b u i ld in g s and h o u seho ld equ ipm en t i s made i n th e l a t e r y e a r s . 136405 - 1 0 0 - ' TABLE XI, APPENDIX C . YEAR-TO-YEAR NET WORTH OF A FARM UNIT REPRESENTED BY YIELD SERIES 1 2 , SPRING WHEAT AREA. Y e a r . L iq u id R e s e rv e ^ / Y ea r ly S u ro luS V alue o f A s s e ts ly S u rp lu s f o r In v e s tm en t V alue o f A s s e t s ^ / S u rp lu s f o r In v e s tm en t ,No. P o l . P o l . D e l . • P o l . P o l . P o l . 0 10 ,086 25 ,000 25 ,0 00 I 5 ,6 2 0 0 21 ,695 0 21,695 0 2 1 ,228 0 18 ,390 0 18 ,390 0 3 1 ,228 2 ,5 7 0 17 ,655 .0 17,655 0 4 2,592 3 ,8 5 0 18 ,180 0 18 ,180 0 5 7 ,498 3 ,8 30 18 ,705 0 18 ,705 -0 6 10 ,086 3 ,9 13 19 ,313 0 1 9 ,3 13 0 7 10 ,086 856 16 ,864 0 16 ,864 0 8 6,498 0 13 ,559 0 13,559 0 • 9 4,665 0 10 ,254 0 10 ,2 54 . 0 10 4 ,6 6 5 1 ,1 27 8,076 0 8 ,0 7 6 0 11 4 ,6 65 2 ,6 4 7 7 ,418 0 7 ,4 1 8 0 12 ■- 2 ,0 5 9 0 4 ,1 1 3 0 4 ,1 1 3 0 13 3 ,1 10 3,830 4,638 0 4 ,6 3 8 0 14 3 ,769 3 ,8 30 5,163 0 5 ,1 6 3 0 15 4,510 3 ,8 30 5 ,6 88 0 5 ,6 8 8 0 16 10 ,086 7 ,086 9,469 0 9,469 0 "17 3,362 0 6 , 164 . 0 1 6 ,1 6 4 0 18 10 ,086 7,662 10 ,521 0 10 ,521 0 19 10 ,086 331 7,547 0 7,547 0 20 10 ,086 4 ,2 3 2 8,474 0 8 ,4 7 4 0 -21 I O'. 086 6 .1 4 6 11 .315 0 9.250 2 ,065 Ending, Inven to ry l0 ,086 — - - 11 ,315 0 9 ,2 5 0 • 2 ,065 a /-T h e l i q u i d r e s e r v e i s h e ld as g r a in i n s to r a g e w ith r e p la c em en t o n ly from h ig h y i e l d y e a r s . V alue o f th e m ach in e ry , e qu ipm en t, and b u i ld in g s o f th e f i rm and h o u s e h o ld . . A f u l l d e p r e c i a t i o n c h a rg e i s s u b t r a c te d ea ch y e a r . - / V a lu e o f t h e m a c h in e r y , e q u ip m e n t , and b u i l d i n g s o f t h e f i r m and h o u s e h o l d . O n ly t h e d e p r e c i a t i o n c h a r g e f o r b u i l d i n g s and h o u s e h o ld e q u ip m e n t i s .m a d e i n t h e l a t e r y e a r s . X - 1 0 1 TABLE X I I , APPENDIX C . YEAR-TO-YEAR NET WORTH OF A FARM UNIT REPRESENTED BY YIELD SERIES S IX , WINTER WHEAT AREA. Y ear ■ L iq u id R e s e rv e s ^ / Y ea r ly S u rp lu s V alue o f A s s e t s ^ / S u rp lu s f o r 1 In v e s tm en t V a lu e of. A s s e t s ^ / S u rp lu s f o r In v e s tm en t No. D o l. D o l . P o l . ■Dol» Dol D o l. 0 1 0 ,1 47 30 ,500 - W - 30 ,500 I 5 ,3 6 8 0 26 ,433 0 26,433 0 2 6,215 4 ,6 0 7 26 ,9 73 0 26 ,9 73 0 3 6 ,2 1 5 616 23,522 0 23,522 0 4 5 ,2 1 6 O 19 ,455 0 19 ,455 0 5 7 ,2 5 2 4 ,6 0 7 19,955 0 19,995 0 6 ' 1 0 ,1 47 10 ,506 2 6 ,4 34 0 2 6 ,4 3 4 0 7 10 ,147 6 ,4 8 0 28 ,847 0 2 8 ,8 4 7 0 8 1 0 ,1 47 5 ,691 30 ,471 0 30 ,471 0 9 10 ,147 10 ,090 30 ,500 5,994 30 ,5 00 5 ,9 9 4 10 10 ,147 2 ,601 29 ,034 0 2 9 ,0 3 4 0 11 10 ,147 3 ,675 28,642 0 28,642 0 12 10 ,147 10 ,743 30 ,500 4 ,8 1 8 30 ,500 4 ,818 13 10 ,1 47 6,970 30 ,500 2 ,9 0 3 30 ,500 2 ,903 14 10 ,1 47 2,929 29 ,362 0 2 9 ,3 6 2 0 15 10 ,147 7,757 30,500 2 ,5 5 2 3 0 ,5 00 2,552 16 10 ,147 5 ,5 8 3 30 ,500 . 1 ,516 2 9 ,2 4 2 2 ,7 74 17 10 ,1 47 7 ,8 2 4 30 ,500 3,757 26 ,035 6 ,9 6 4 18 10 ,147 16 ,116 30 ,500 12 ,049 2 2 ,8 2 8 15,256 19 10 ,147 4,974 30 ,500 907 19 ,621 4 ,1 1 4 20 10 ,147 9,497 30 ,500 5 ,4 3 0 16 ,414 8 ,6 37 21 10 ,147 15 ,909 30 ,500 11 ,842 13 ,2 07 15 ,049 22 Ending. 1 0 .147 14.601 30 .500 10 .534 10 .0 00 . 13 .741 In v e n to ry 1 0 ,1 47 • 3 0 ,500 6 2 ,3 02 10 ,000 82 ,802 a / The l i q u i d r e s e r v e i s ■ from h ig h y i e l d y e a r s h e ld a s g r a in i n s to r a g e w ith r e p la c em en t o n ly b / V a lue o f th e m ach in e ry , eq u ipm en t, and b u i ld in g s o f th e f irm and h o u se h o ld . A f u l l d e p r e c ia t io n c h a rg e i s s u b t r a c te d each y e a r . S J V a lue o f th e m ach in e ry , eq u ipm en t, arid b u i ld in g s o f t h e f i rm and h o u s e h o ld . Only th e d e p r e c ia t io n ch a rg e f o r b u i ld in g s and h o u seho ld equ ipm en t i s made in th e l a t e r y e a r s . - 1 0 2 - TABLE X I I I , APPENDIX C0 . YEAR-TO-YEAR NET WORTH OF A FARM UNIT REPRE­ SENTED BY .YIELD SERIES 1 6 , WINTER WHEAT AREA. Year. L iq u id , Res e r v e d / Y ea r ly S u ro iu s : V alue o f t : 'Ass e t s ^ / S u rp lu s f o r In v e s tm e n t ' V alue o f A s s e t s ^ / • S u rp lu s f o r In v e s tm en t No. D o l. •D ol.' D o l. D o l. D o l . D o l. 0 1 0 ,1 47 30,500" — •* — 30 ,500 I 6 ,7 0 4 0 26 ,433 0 2 6 ,4 33 0 2 2 ,2 2 0 0 22,366 0 22,366 0 3 2,220 2,699 20,99.8, 0 20,998 0 4 4 ,7 0 7 4 ,6 0 7 21 ,538 . 0 2 1 ,5 38 0 5 .7 ,408 4,607 22 ,078 0 22 ,0 78 0. 6 10 ,147 11 ,144 29,155 0 29 ,155 0 7 1 0 ,1 47 14 ,555 3 0 ,5 0 0 . 9,,143 3 0 ,5 00 9 ,1 43 8 10 ,147 698 27 ,131 . o . 27 ,131 0 9 8,262 0 23 ,064 6 2 3 ,0 6 4 0 10 8 ,2 6 2 174 19 ,171 0 19 ,171 0 11 3 ,1 3 0 0 15 ,104 0 15 ,104 0 ■ 12 10 ,147 6 ,891 17,928 0 17 ,928 0 ,1 3 1 0 ,1 4 7 , 1,215 15 ,076 0 15 ,076 0 14 9 ,0 8 2 0 11 ,009 0 11 ,009 0 15 6 ,7 2 2 0 6,942 0 6 ,9 4 2 • 0 16 6,722 2,994 5 ,869 0 5,869 0 .17 10 ,1 47 5 ,3 4 7 7 ,149 ' 0 7,149 0 18 1 0 ,1 4 7 . 9,255 12 ,337 ■ 0 12 ,3 37 0 19 10 ,147 1 ,658 9,928 0 9,928 0 20 ' 1 0 ,147 846 6,707 0 6 ,7 0 7 0 21 10 ,147 10 .090 12 .730 0 10 .000 2 .730 Ending Inventory lti, l 47 - - - 1 2 ,730 9 ,1 4 3 10 ,0 00 - ' 11 ,873 & The l i q u i d r e s e r v e i s h e ld a s g r a in i n s to r a g e w ith re p la c em en t o n ly from h ig h y i e l d y e a r s . b / V alue o f th e m ach in e ry , eq u ipm en t, and b u i ld in g s o f t h e f irm and h o u s e h o ld . A f u l l d e p r e c i a t i o n c h a rg e i s s u b t r a c te d e ach y e a r . s/ V a lu e o f t h e m a c h in e r y , e q u ip m e n t , and b u i l d i n g s o f t h e f i r m and h o u s e h o l d . O n ly t h e d e p r e c i a t i o n c h a r g e f o r b u i l d i n g s and h o u s e h o ld e q u ip m e n t i s m ade i n t h e l a t e r y e a r s . I “ 1 0 3 ■” TABLE X IV , APPENDIX C . YEAR-TO-YEAR NET WORTH OF A FARM UNIT REPRE- . SENTED BY YIELD SERIES 1 9 , WINTER WHEAT AREA. Year L iq u id Reserve=*/- Y ea r ly S u rp lu s V alue o£ ' A s s e t s ^ / S u rp lu s 'foY In v e s tm en t V alue o£ A s s e t s ^ / S u rp lu s f o r In v e s tm en t No. P o l . D o l . P o l . D o l. D o l. D o l. ■ 0 13 ,530 30 ,500 0 30,500 0 I 11 ,916 0 26 ,433 0 26,433 0 2 11 ,916 321 2 2 ,6 8 7 0 22,687 0 3 9 ,761 0 18 ,620 0 18 ,620 0 4 8 ,5 5 7 0 . 1 4 ,553 0 14 ,553 0 5 8 ,5 5 7 100 10 ,586 0 10 ,586 0 6 8 ,5 5 7 1 ,141 7 ,660 0 7 ,6 6 0 0 7 12 ,151 4 ,6 0 7 8 ,2 0 0 0 8 ,2 0 0 0 8 8 .5 7 7 8 .5 7 7 0 4 ,1 3 3 0 4,133 0 9 764 830 , 0 830 0 10 ' 1 3 ,530 9,327 6 ,0 9 0 0 6 ,0 9 0 0 11 9 ,1 0 3 0 2 ,0 23 0 2 ,0 2 3 0 12 6 ,7 4 3 0 - 2 ,0 4 4 0 - 2 ,0 4 4 0 13 6 ,7 4 3 1 ,510 .- 4,601 0 - 3,343 0 14 3,924 0 - 8 )668 0 - 4 ,2 0 3 0 15 3 ,5 4 0 0 -1 2 ,7 3 5 0 - 5 ,0 6 3 0 16 2,746 0 -1 6 ,8 0 2 0 ■ - 5 ,9 2 3 0 17 697 0 -2 0 ,8 6 9 O - 6,783 0 18 . 897 ' 4 ,6 0 7 - 20,329 0 - 3 ,0 3 6 0 19 6.353 4 ,6 0 7 -1 9 ,7 8 9 0 • 711 0 Ending In v e n to ry 6 ,3 5 3 —— — -1 9 ,7 8 9 0 711 P a / The l i q u i d r e s e r v e i s h e ld as g r a in in s to r a g e w ith re p la c em en t o n ly from h ig h y i e l d y e a r s . h / V alue o f th e m ach in e ry , e q u ipm en t, and b u i ld in g s o f th e f irm and h o u s e h o ld . A f u l l d e p r e c i a t i o n c h a rg e i s s u b tr a c te d - e a c h ,y e a r . $ / V alue o f th e m ach in e ry , e q u ipm en t, and b u i ld in g s o f t h e f irm and h o u s e h o ld . Only th e d e p r e c ia t io n c h a rg e f o r b u i ld in g s and h o u seho ld equ ipm en t i s made i n th e l a t e r y e a r s . - 104- - BIB LIOGBAPHI B a rb e r , L loyd E . , . .’'.M odify ing th e F e d e r a l Income Tax t o P rom ote G re a te r S t a b i l i t y o f Farm In com e ,'* J o u rn a l o f Farm E conom ics . Volume 30 , Number 2 , H ay , 1948« . .. ............... ,H a lc row , H a ro ld G4., " A c tu a r i a l S t r u c t u r e s f o r Crop I n s u r a n c e ," J o u rn a l -QjLEarm-Econom ics « Volume 3 1 , ,Number 3 , A ugu st, 1949 , Heady, E a r l O4, Econom ics o f A g r i c u l t u r a l P r o d u c tio n and B esou rn e U se . P r e n t i c e -H a l l , I n c 4, Englewood C l i f f s , New 'J e r s d y , ' ' 1952 , H e i s ig , C a r l P 4, "Incom e S t a b i l i t y i n H ig h - r i s k F arm ing A r e a s ," J o u rn a l o f Farm E conom ics . Volume 28 , Number 4 , November, 1946, K i f e r , R4 S4, and H^ L4 S t e w a r t * 'Farm ing H aza rd s i n th e B ro u g h t A re a . Wofks, Progress; Administration,' Division of Social Research, R e se a rc h Monograph 1 6 , U4 S4 Government P r i n t i n g O f f ic e , W ash ing ton , B 4 C4, 1938, K r i s t j a n so n , B a ld u r H4, and E r n e s t S o lb e r g , Farm R e n ta l B a rg a in in g i n N o r th D ak o ta , N o rth D ak o ta A g r i c u l t u r a l E xpe rim en t S t a t i o n , ' F a rg o , N o rth D a k o ta , B u l l e t i n 372 , M arch , 1952 , K r i s t j an son ,. B a ld u r H4, ' and Ja co b A, Brown, The F a rm ers Home Admin­ i s t r a t i o n A pproach t o Farm C r e d i t P ro b lem s . N o r th D ako ta A g r i c u l t u r a l E xp e r im en t S t a t i o n , F a rg o , N o rth D ako ta ,' B u l­ l e t i n 3 88 , J a n u a ry , 1954 , ' ' L a r s e n , H ara id .C4, and N e i l W..- Jo h n son , M anaging Farm F in a n c e s , U4 S 4 Government P r i n t i n g O f f ic e , W a sh in g to n '2 5 , D4' C4, M is c e l l a n e o u s 'P u b l i c a t io n Number 652 , U4 S 4 D ep a r tm en t o f A g ri­ c u l t u r e , S ep tem be r, 1948 , N o r th e rn G re a t P l a i n s A g r i c u l t u r a l A dv iso ry C o u n c il , Im p ro v in g Farm and Ranch Tenure i n th e G rea t P l a i n s . R epo rt Number I- o f th e T enure C omm ittee , M ontana A g r i c u l t u r a l Experim ent" S t a t i o n , Bozeman, M ontana, B u l l e t i n 436 ," J u ly , . 1946, S c h ic k e l s , R a in e r , "Farm B u s in e s s S u rv iv a l Under Ex trem e W eath e r ,R isk s ," J o u rn a l o f F arm E conom ics . P ro c e e d in g s Number, Volume 3 1 , Number 4 , November> 1949 , S c h ie k e le , R a in e r , "F a rm e rs A d a p ta t io n s t o Income U n c e r ta in ty ," J o u rn a l o f Farm E conom ics . Volume 3 2 / Number 3 , A ugu s t, 1950 , S c h ic k e le , R a in e r , " L iv e s to c k a s Income S t a b i l i z e r , " B im on th ly B u l l e t i n . Volume 12 , Number 6 , J u ly -A u g u s t , 1950 , - 105 S c h ic k e le , R a in e r , " V a r i a b i l i t y o f N o rth D ak o ta Farm In com e ," B im on th ly B u l l e t i n . Volume 1 1 ,/ J u ly -A u g u s t , 1949. S locum , W a lte r L . , The I n f lu e n c e o f T enu re S t a tu s Upon Rnrml Tnfft in Eaat_ern.-SQuth .D ak o ta , . S ou th D ako ta A g r i c u l t u r a l E x p e r im en t S t a t i o n , B ro o k in g s , S ou th D akota ', C i r c u l a r 3 9 , May, 1942., T a eu b e r , C on rad , and C a r l C. T a y lo r , The P e o p le o f th e D rough t S t a t e s . Works P r o g r e s s A d m in is t r a t io n , D iv i s i o n o f S o c i a l R e s e a rc h , .... S e r i e s 5 , Number.2 , W ash ing ton ,..!) , C . , M arch, 1937 . T h a i r , P h i l i p J . . S t a b i l i z i n g Farm Income A g a in s t Crop Y ie ld F l u c t u a t i o n s . "N orth D ak o ta A g r i c u l t u r a l E xperim en t' S t a t i o n , F a rg o , N o rth D ak o ta , B u l l e t i n 362 , S ep tem be r, 1950 . T h a i r , P h i l i p J . , M eeting t h e Im pac t o f C ro p -Y ie ld R isk s i n G re a t P j a i n s F a rm in g , N o r th D ak o ta A g r i c u l t u r a l E xp e rim en t S t a t i o n , F a rg o , N o r th D a k o ta , B u l l e t i n 3 9 2 , J u n e , 1954,. U n ite d S t a t e s D ep a r tm en t o f A g r i c u l t u r e , A g r i c u l t u r a l P r i c e and C ost .... P r o je c t io n s , , W ash in g to n , D. C , , S e p tem b e r, .195.7. The F u tu re o f th e G re a t P l a i n s . R ep o rt o f th e G re a t P l a i n s C omm ittee , ■ U. S . Government P r i n t i n g O f f ic e , W ash in g to n , D . C . , D ecember, 1936 »MONTANA STATE UNIVERSITY LIBRARIES 762 10014330 2 N378 H643u eearmct^ wwiiW6- 136405 cop.2 Hjort, H. W. The use and effectiveness of ■ * and physical reserves NOV 2 Qjj 'J % ' A t i t • i-c n if- ~j /.. . / ■ IP' ^ f JV 8AS1 WOiiFt,* I - IC j l 136405