Allied & ICAR Exam Bank • ALLIED_2950 MCQ • 1 Mark

Section 2: Farm Machinery

Farm Machinery

Subtopic: Cost analysis of implements and tractors

Question Statement:

Salvage value of an agricultural tractor at the end of its typical $10\text{-year}$ useful working life is standardly estimated as:

Options:

  • (A) $10\%$ of initial purchase price
  • (B) $50\%$ of purchase price
  • (C) $0\%$ always
  • (D) $100\%$

Answer Key:

A

Step-by-Step Solution & Explanation

Standard agricultural economics conventionally uses $10\%$ salvage (scrap) value at the end of economic life.
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