ORGANIZATION OF THE FARM 



of horses and machinery in the place of laborers, 

 but it may at the same time happen that the prod- 

 uct resulting from these operations is likewise 

 reduced. It is not always true, therefore, that 

 every operation should be performed in the least 

 expensive manner, in fact, it may easily happen 

 that the most expensive method will result in the 

 largest net profit. 



One point never to be overlooked in consider- 

 ing the desirability of substituting laborers for 

 capital-goods or vice versa, is, the relative demand 

 which will be made upon the time and energy of 

 the manager. Any change in the proportions of 

 these factors in the composite unit, which will 

 increase the amount of managerial activity per 

 such unit, must sufficiently increase the farmer's 

 net profit per composite unit to balance the loss 

 due to the reduction in the number of such units 

 which can be brought under a given unit of man- 

 agerial activity. 



Where the substitution of the one factor for 

 the other makes no change either in the quantity 

 of the product or in the amount of managerial 

 activity required, the rule is a simple one : where 

 there is a choice between using laborers or capital- 

 goods in the performance of certain operations, 

 choose the cheaper method. And yet, the quali- 

 fying phrases in this formula are so important 

 that the problem is far from being a simple one, 

 and in many cases, perhaps in most cases, it is the 



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