What is the opportunity cost of feeding farm raised grain to hogs?
The value of the corn if sold in the open
Assume the Accounting (production)cost of
= $2.50 / bushel
Assume the Current market price of corn = $3.50 / bushel
Let us assume that you are harvesting your corn crop for the season and are considering selling the corn in the current cash market, or buying some feeder pigs to feed out to slaughter. You check your accurate farm records and determine that it has cost you $2.50 per bushel to grow this corn crop. Assume the current cash market price for corn is $3.50 per bushel. If you hold the corn and feed it to hogs, what does each bushel of corn fed cost you?