Figure 12. Relationship of Various Expenditure Functions and Capital 

 Accumulation with Changes in the Level of Income. 



FAMILY 

 CONSUMPTION 



3 2 I 4 



GROSS CASH INCOME 



The determinants of grower income — feed conversion, broiler prices 

 and chick placement — were discussed earlier. Conditions in the future 

 could alter these short-run cycles to the extent that growers may be able 

 to accumulate more capital out of income in other seasons of the year. 



Long-Run Changes in Income and Expenditures 



The long-run trends of income and expenditures are the essential fac- 

 tors in determining the stability of the broiler industry. In the long run 

 income must be sufficient to allow contract growers to maintain or im- 

 prove their standard of living, pay recurring business expenses, and ac- 

 cumulate sufficient capital to replace worn-out physical facilities. If these 

 conditions cannot be maintained, growers will seek other alternatives 

 either in or out of the poultry industry. 



Previous analyses indicated that the factors determining income have 

 developed trends that are not expected to change for some period of 



32 



