Turnip Farm Case Summary

172 Words1 Pages
After reviewing all cost and profit amounts in question 1-5, Tom did not make a good economic decision in starting his own turnip farm. As the case did not specify how much Tom will be earning a year managing Turnip Tom’s, according to the income statement, Tom’s revenue at the organic farm is $3,000 more than his computer programmer salary at $95,000. Tom’s economic cost indicated he will be losing -&77,900 per year operating the business as well as spending $300,000 in savings to purchase land and equipment for the farm. Although utilizing saving was a good decision to own the land and equipment, however, Tom’s cost products sold is only $15,500, meaning consumers are not buying turnips as a supply and demand product. My suggestion to Tom