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AEA302Agricultural Sciences3 Unitsintermediate

Agricultural Finance

This course introduces students to the principles and practices of agricultural finance. It covers topics such as the meaning and scope of agricultural finance, credit classification, and the importance of credit to farmers. The course also explores basic economic principles, capital acquisition methods, financial tools, risk management, agricultural insurance, and marketing. Students will learn how to apply these concepts to make informed financial decisions in agricultural settings.

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60h

Study Time

13

Weeks

5h

Per Week

basic

Math Level

Course Keywords

Agricultural FinanceCreditFarm ManagementRisk ManagementCapital Budgeting

Course Overview

Everything you need to know about this course

Course Difficulty

Intermediate Level

Builds on foundational knowledge

65%

intermediate

➕

Math Level

Basic Math

🔬

Learning Type

Hands-on Practice

Course Topics

Key areas covered in this course

1

Agricultural Finance

2

Credit Classification

3

Farm Records

4

Economic Principles

5

Capital Acquisition

6

Risk Management

7

Agricultural Insurance

8

Marketing Channels

Total Topics8 topics

Ready to Start

No specific requirements needed

This course is designed to be accessible to all students. You can start immediately without any prior knowledge or specific preparation.

Assessment Methods

How your progress will be evaluated (3 methods)

Assignments

Comprehensive evaluation of course material understanding

Written Assessment

Tutor-Marked Assessments

Comprehensive evaluation of course material understanding

Written Assessment

Final Examination

Comprehensive evaluation of course material understanding

Written Assessment

Career Opportunities

Explore the career paths this course opens up for you

Farm Manager

Apply your skills in this growing field

Agricultural Loan Officer

Apply your skills in this growing field

Agricultural Economist

Apply your skills in this growing field

Agribusiness Consultant

Apply your skills in this growing field

Financial Analyst

Apply your skills in this growing field

Industry Applications

Real-world sectors where you can apply your knowledge

BankingInsuranceAgricultural ProductionAgribusinessGovernment Agencies

Study Schedule Beta

A structured 13-week journey through the course content

Week

1

Module 1: Agricultural Finance

4h

Unit 1: Meaning and Scope of Agricultural Finance

2 study hours

•Define agricultural finance and its importance.
•Describe the nature of agricultural finance in traditional and developed agriculture.
•Explain the role of financial intermediaries in agriculture.

Unit 2: Classification of Credit

2 study hours

•Classify credit by length of time, purpose, security, and lenders' policies.
•Differentiate between production and consumption credit.
•Understand the implications of each credit classification.

Week

2

Module 1: Agricultural Finance

4h

Unit 3: Importance of Credit to the Farmer

2 study hours

•Explain the importance of credit to farmers.
•Discuss the essential conditions for credit to facilitate agricultural development.
•Analyze the advantages of an efficient credit program.

Unit 4: Farm Records Keeping for Financial Decision Making

2 study hours

•Identify the importance of keeping farm records.
•Describe the different types of farm records.
•Understand how farm records aid in financial decision-making.

Week

3

Module 1: Agricultural Finance

2h

Unit 5: Farm Accounts for Financial Management

2 study hours

•Explain the principles of keeping farm accounts.
•Understand the importance of farm accounts for financial management.
•Apply accounting principles to manage farm finances effectively.

Week

4

Module 2: Basic Economic Principles for Agricultural Finance

4h

Unit 1: Input-Output Relationships (Law of Diminishing Returns)

2 study hours

•Define the law of diminishing returns and its decision rules.
•Determine the most profitable level of production.
•Apply the principle of marginalization in farm decisions.

Unit 2: Input-Input Relationships

2 study hours

•Differentiate between isoquant and isocost.
•Determine least-cost combinations of factors of production.
•Explain types of substitution between inputs.

Week

5

Module 2: Basic Economic Principles for Agricultural Finance

4h

Unit 3: Product-Product Relationships

2 study hours

•Explain the production possibility curve and the iso-revenue line.
•Determine maximum revenue output combination.
•State the different types of product-product relationships.

Unit 4: Principles of Equi-marginal Returns and Opportunity Cost

2 study hours

•Explain average and marginal returns to capital.
•Describe the equi-marginal returns principle.
•Analyze the uses of the equi-marginal returns principle.

Week

6

Module 2: Basic Economic Principles for Agricultural Finance

4h

Unit 5: Law of Comparative Advantage

2 study hours

•Define the law of comparative advantage.
•Discuss the importance of comparative advantage.
•Describe how decision rules are used for the concept of comparative advantage.

Unit 6: Cost Functions

2 study hours

•Define the various cost functions.
•Sketch the shapes of the cost functions.
•Explain relationships between the cost functions.

Week

7

Module 3: Capital

4h

Unit 1: Internal Methods of Acquiring Capital

2 study hours

•Explain inheritance and its role in acquiring capital.
•Describe the role of gifts in capital acquisition.
•Discuss the importance of savings and family arrangements.

Unit 2: External Methods of Acquiring Capital

2 study hours

•Explain incorporation and its advantages and disadvantages.
•Describe leasing and purchase contracts.
•Discuss vertical integration and borrowing as external capital sources.

Week

8

Module 3: Capital

4h

Unit 3: Internal and External Sources of Capital

2 study hours

•Explain internal sources of finance.
•Describe non-institutional and institutional external sources of finance.
•Differentiate between formal and informal lenders.

Unit 4: Agricultural Credit Banks

2 study hours

•Describe at least five agricultural credit banks.
•Explain the roles of different agricultural credit banks.
•Understand the functions of each bank in supporting agricultural finance.

Week

9

Module 4: Economic Financial Tools

4h

Unit 1: Concept of Interest Rates

2 study hours

•Define interest rate and explain why it is charged.
•Enumerate factors affecting interest rates.
•Calculate interest rate using different methods.

Unit 2: Analysis of Interest Rates on Loans

2 study hours

•Discuss the functions of commercial banks.
•Explain the conceptual framework of commercial banks.
•Describe the principles of lending.

Week

10

Module 4: Economic Financial Tools

4h

Unit 3: Three R's and Five C's of Credit

2 study hours

•Explain the 3 R's of credit: Returns, Repayment capacity, and Risk-bearing ability.
•Explain the 5 C's of credit: Character, Capacity, Collateral, Capital, and Condition.
•Understand how these principles are used in credit assessment.

Unit 4: Seven P's of Credit

2 study hours

•Explain the seven P's of credit: Productive Purpose, Personality, Productivity, Phased Disbursement, Proper Utilization, Payment, and Protection.
•Discuss how these principles guide effective credit management.
•Apply these principles to real-world agricultural lending scenarios.

Week

11

Module 5: Economic Financial Tools

4h

Unit 1: Acquisition of Capital and Attendant Risks

2 study hours

•Explain the principle of owner's equity and increasing risk.
•Discuss the procedural formalities in sanction of farm loans.
•Explain different repayment plans.

Unit 2: Planning and Budgeting

2 study hours

•Define planning and budgeting.
•Explain the need for planning.
•Describe the budgeting technique and its advantages.

Week

12

Module 5: Economic Financial Tools

4h

Unit 3: Net worth Statement

2 study hours

•Prepare a net worth statement.
•Estimate test ratios.
•Interpret test ratios to assess financial health.

Unit 4: Income Statement

2 study hours

•Determine net farm income.
•Determine financial test ratios.
•Determine management ratios to evaluate farm performance.

Week

13

Module 7: Costs and Risks in Agricultural Lending

4h

Unit 1: Types of Risks and Strategies to Reduce Risks

2 study hours

•Explain why lenders face high financial transactional costs.
•Describe the risks associated with agricultural lending.
•Describe the risks faced by small-scale farmers.

Unit 2: Problems Encountered by Government Financial Institutions

2 study hours

•Explain the various problems encountered by government financial institutions.
•Discuss the challenges in providing agricultural credit effectively.
•Analyze the impact of these problems on agricultural development.

This study schedule is in beta and may not be accurate. Please use it as a guide and consult the course outline for the most accurate information.

Course PDF Material

Read the complete course material as provided by NOUN.

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Study Tips & Exam Preparation

Expert tips to help you succeed in this course

1

Review all key definitions and concepts from each unit.

2

Practice applying economic principles to agricultural finance scenarios.

3

Create summaries of the different types of credit and their uses.

4

Study examples of farm records and financial statements.

5

Focus on understanding risk management strategies and agricultural insurance.

6

Review past assignments and tutor-marked assessments.

7

Allocate sufficient time for studying each module based on its complexity.

8

Create flashcards for key terms and formulas.

9

Practice solving numerical problems related to interest rates and capital budgeting.

10

Form a study group to discuss challenging concepts and share insights.

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