MERU UNIVERSITY OF SCIENCE AND TECHNOLOGY

P.O. Box 972-60200 – Meru-Kenya

Tel: +254(0) 799 529 958, +254(0) 799 529 959, + 254 (0) 712 524 293,
Website: info@must.ac.ke Email: info@must.ac.ke

University Examinations 2023/2024

THIRD YEAR FIRST SEMESTER EXAMINATION FOR THE DEGREE OF BACHELOR

OF SCIENCE IN AGRICULTURE, BACHELOR OF SCIENCE IN AGRICULTURAL
EDUCATION AND EXTENSION AND BACHELOR OF SCIENCE IN ANIMAL HEALTH
AND PRODUCTION

AAB 3325: AGRIBUSINESS MANAGEMENT

DATE: DECEMBER 2023 TIME: 2 HOURS

INSTRUCTIONS: Answer question one and any other two questions

QUESTION ONE (30 MARKS)

a) With the aid of illustrations explain the following (6 marks)

(i) Marginal rate of Technical substitution
(ii) Diminishing marginal rate of technical substitution
(iii) Isoquant
b) Some managers are successful while other are not. Give reasons (4 marks)
c) State the uses of a cash flow budget (4 marks)
d) State the six functions of farm management (6 marks)
e) Explain the ways of showing a production function (4 marks)
f) State any six ways of minimising risks in agriculture (6 marks)

MUST is ISO 9001:2015 and ISO/IEC 27001:2013 CERTIFIED Page 1

QUESTION TWO (20 MARKS)

Triple P Farm has been planting Wheat and the Manager is contemplating replacing the crop with
Barley. The manager has the information shown on the table;

Triple P Farm Records

Item Description Wheat Enterprise Barley Enterprise

Amount KSH Amount KSH

Sales 100,000 120,000

Fertilizer 7,000 4,000

Labour 15,000 6,000

Chemicals 6,000 4,000

Depreciation 7,000 2,000

Insurance 5,000 3,100

In reference to the above information;

a) Prepare a partial budget (12 marks)

b) Explain the questions that are addressed by a partial budget (8 marks)

QUESTION THREE (20 MARKS)

a) Explain the steps of a scientific labour selection process (10 marks)

b) Explain the external sources of labour for a farm (10 marks)
QUESTION FOUR (20 MARKS)
a) Explain the uses of a complete budget (10 marks)
b) Explain the limitations of gross margin budget (10 marks)

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