TABLE OF CONTENTS
Aims and objectives………………………………………………..4
Report ………………………..……………………………………. 7-21
An Investigation into problems faced by small farmers in the area of Mayaro/Rio Claro
This Assignment is the fruit of concerted efforts. A project of this magnitude was effectively
compiled with the assistance and contribution of a number of individual; gratitude must be
extended to such persons.
I am highly indebted to God Almighty for his guidance, health and strength I needed to
complete this Economics internal assessment so as to meet the requirements of the Caribbean
Advance proficiency examination syllabus. I would like to express my gratitude towards my
parents for their kid co-operation and encouragement which helped me in the completion of this
project. I would also like to show a special thanks to my Economics teacher for giving me
attention and time.
My thanks and appreciation also goes to my siblings who did my share of chores so that I can
complete my assignment.
Aims and objectives
This internal assessment provides an opportunity for me to individualize a part of the syllabus
that is an integral part of my assignment in the course of C.A.P.E level one (1) certification
representing 20% towards the final assignment
The aims and objectives of this Internal Assessment are:
An investigation in the problems affecting small farmers.
How can the problems affect consumers( demand and supply)
The effects of the problems on the economy through the application of economic
principles, theories and concepts used.
Understanding the laws, principles and theories governing demand and supply.
calculate numerical values of elasticity
The consequences if the problem is not solved.
Recommendation for the solving the problems affecting small farmers.
Methodology refers to the study of methods of research. For this assessment both primary and
secondary sources of information were used.
Primary data is observed or collected form first-hand experience. Quantitativeresearch refers to
the systematic empirical investigation of social phenomena via statistical, mathematical or
computational techniques.To obtain information, Quantitative research was conducted on the
problems affecting small farmers through a questionnaire which is a research instrument
consisting of a series of questions and other prompts for the purpose of gathering information
from respondents. A total of twenty (20) questionnaires were distributed amongst small farmers
which included twenty five questions (refer to appendix) on the 4th February 2013. The
questionnaires were distributed and collected the next day. A random sample was used because
only farmers were needed to answer the questionnaires. Qualitative researchis used to explore
and understand people's beliefs, experiences, attitudes, behaviour and interactions. It generates
non- numerical data andwas conducted to obtain facts about problems affecting small farmers.
This was done through an informal interview with one of the farmer located in Mafeking Road,
Mayaro on Tuesday 19th February, 2013 at 12:30pm.It is a conversation between two or more
people where questions are asked by the interviewer to elicit facts or statements from the
interviewee. I went to his home in Mafeking and asked for permission to interview him for a
detailed response about the problems affecting his business, there were a clear context to the
questions when we began the conversion in that the farmer was not confused as to what was
being asked. It also allowed me to probe for more answers and I took that opportunity to observe
his non-verbal cues during the informal interview. The disadvantage of using the informal
interview was time consuming because I had to travel to meet the interviewee using public
transport where there were several stops before my destination and the conversion went on for
twenty minutes due to the excessive amount of information that was share by farmer. The
questionnaire allowed me to target a large amount of farmers and it was less time consuming
because there was just straight forward answers required. Problems faced during the
questionnaire data collection were that some of the Farmers left questions unanswered and some
refused to take part in completing the questionnaires. In order to avoid facing these problems
with the primary data collection, the questions were designed and planned in an efficient and
understandable manner yet some of the employees did not understand due to their lack of
knowledge on the questions asked. This was a convenience sample because of the location of the
Secondary sources of information that has been already in existence was used, from the internet,
textbooks and reports from the Central Statistical Office. This method of data collection also
played an important role in the effective compilation of my Assessment. The textbooks used in
the data collection process, contained the general information that corresponded with the CAPE
syllabus, these information provided a linkage between what is being thought and what it is
actually like in a real model situation. Data were obtained from the CAPE ECOMOMICS
textbooks. These two sources used in the data collection process were sufficient to complete my
research. During the research, I encounter a few problems such as limited amount to have a
thorough research on the topic, due to the fact that searcher time had to be balanced out with
other internal assessment and it was difficult to obtain data from the internet because there were
contradictions with the information in the textbooks. Information was also collected form the
central statistical office to study the problems affecting the amount of small farmers, this was a
reliable source. The advantages of using the secondary source were: it save money and time as
compared to printing the questionnaires and conducting the informal interview and it also helped
to make primary data collection more specific since with the help of secondary data, we were
able to make out what are the gaps and deficiencies and which additional information needed to
be collected. It helped to improve the understanding of the problem with the concepts in the
textbooks. The disadvantages were that the information from the book did not exactly fit the
research questions and some were obsolete data.
However, at the end of my investigation, the information that I had received from both primary
and secondary resources had proven to be valid and reliable because they both had the same
Economics is a social science that analyses the production, distribution, consumption of goods
and services and transfer of wealth. “It is also a discipline which teaches us how to use the scare
resources that we have in a way which makes it possible to improve our lives”-Karl Theodore.
Farming is the activity or business of growing crops and raising livestock. It deals production
where the farmers produce their own crops in exchange for income that can be used to purchase
other necessities. Agriculture is very important to Trinidad and Tobago as it provides sources of
finance, employment and food for the citizens which will increase our standard of living. As this
is an example of supply. Supply is the quantity of goods and services that a producer is willing to
produce for market transaction at a given price in a given time period.If there is not sufficient
resources and methods inputted into production, it might slow down production and our country
would experience many problems including high import bills, this happens when production is
low andthe law of supply and demand says that a price will move either up or down based on the
balance of supply and demand. As the supply decreases, prices will move higher because the
product is scarce. As supply increases, prices will move lower because the product is readily
available and with an increase in price it will lead consumer to import goods which in most cases
we experience a balance of payment of deficit and unemployment as agriculture is a prime
occupation of working population in our country.Oftentimes, farmers are given less priorities by
the government in giving grants and aids in infrastructures and other economic benefits.
Actually, without them the economy which is highly dependent on agriculture is doomed to fail.
When the farmer becomes rich, the nation will also become rich. If majority of the farmers in a
country are rich, then the economy of that country will rise due to higher tax contributions. These
farmers could be rich if the government supports them their farm inputs needs.
Businesses that have lower costs, are more efficient, and can deliver quality products, are those
that prosper. Those that have high costs, fail to adapt to changes in market demand and provide
poorer quality is often forced out of business.
The following are some agriculture problems faced by the Mayaro/Rio Claro small farmers:
Difficulty in obtaining labour
Destruction by pest and diseases
The table shows the number of farmers affected by some agriculture problems in Trinidad and is
generally compared to the numbers affected in the area of Mayaro/Rio Claro:
Destruction by Pest and Diseases
Difficulty in obtaining labour
The farmers of Mayaro /Rio Claro, cultivates an array of crops under the domestic level of
production. They produce an adequate amount to survive and to create a surplus that will satisfy
the needs of others. This allows farmers to generate their income on a day-to-day basis that will
help endure in their farming production. These farmers carry out small scale farming because
they do not have the sufficient amount of resources to utilize and expand their farming
production. The following entailed Internal Assessment, will be focused on two major
agriculture problems: Destruction by Pest and diseases and difficulty in obtaining Labour which
are all problems that affect the farmers of the area, Mayaro/Rio Claro.
Difficulty in Obtaining Labour
One of the problems faced by farmers is obtaining labour. Labour influence cost of production
because it is challenging to find labour. Factors of production are the input in the production
process. As being one of the factor of production, it is just as vital as the rest for it is the physical
input to the creation of the goods.it is difficult to obtain labour because the price at which
farmers would want to pay for its labour. In the area of Mayaro/Rio Claro, the oil and gas
industry, British petroleum of Trinidad and Tobago (bptt) is located nearby, and therefore many
people prefer to work there as a result of higher paying jobs.
This causes great problem for farmers. In order to maintain business, some farmers are force
to pay higher for labour (in order to obtain its workers). This influences the factor of production,
that is labour, to increase cost of production. Therefore, this influences the production of one unit
of one good to be very costly. It also affects the farmers from gaining economies of scale where
an expansion of output leads to a reduction in the unit costs, they occur because the firm’s output
is rising proportionally faster that the inputs, hence the business is getting increasing returns to
scale. The goods are at a high cost, therefore is not a reduction in unit cost per producedi.e. a fall
in the Average total cost (ATC). This makes it difficult for the consumer who has limited finance
to purchase agriculture goods. Therefore decreasing the demand for agriculture products and
slowing down production for the farmer.
The diagram below, demonstrates that the upward slope of the Marginal cost curve as the supply
curve. Therefore as the Marginal cost curve shifts upwards; supply curve will shift to the left.
Quantity supplied per week
Figure 1: Upwards Cost Curve as the Supply Curve.
Marginal cost is the extra or incremental cost the business incurs form producing the last unit of
a commodity or the change in total cost (TC) from one unit increase in the output or simply the
increase in total cost resulting from raising the rate of production by one unit
( ∆ TC)
In economics, diminishing returns (also called diminishing marginal returns) is the decrease in
the marginal (per-unit) output of a production process as the amount of a single factor of
production is increased, while the amounts of all other factors of production stay constant. Law
of diminishing returns states that it takes more labour to produce additional units. Therefore the
marginal product of labour is lower and the marginal cost is higher, that is why the curve slopes
upwards. But at the same time, the farmers should not increase worker to much because in the
short run, ceteris paribus (holding technology and capital equal), if you keep increasing labour,
you are going to suffer from diminishing marginal returns and extra money will be spending on
At the same time demand will be affected because as price constantly increases the demand for
the good will decreased, hence supply will diminishing as well.
The diagram below, demonstrate the effects of a decrease in supply due to when difficulty in
obtaining labour occurs. When assumes that S in the original amount supplied and S1 is the
changed in the amount of lettuce supplied, as the prices increases.
Price ($) 3 E
Quantity of lettuce
It is showed that the price of potatoes were at $ 3.00 at the demanded quantity 15 due to
the difficulty in obtaining labour, the supplies decreased to 10 potatoes at $4. This result
in high prices.
Figure2: shift in the supply of lettuces
The Bar Chart shows the number of farmers that are affected by difficulty in obtaining
labour in Trinidad when compared to the number affected in the area of Mayaro/Rio
Farmers affected by Difficulty in Obtainig
Farmers affected by Difficulty in
2441 of Farmers in Trinidad are affected by the problem, of Obtaining Labour. Generally,
382 of the overall farmer’s populations are affected by this problem in the area of
Mayaro/ Rio Claro. This number compared to the total amount is quite a high number.
If this problem continues to plague farmers, the time it usually takes in producing goods
will decrease due to the limited amount of workers employed. Therefore, with a great
amount of workers the work can be done accordingly. However, the supply of the goods
may decrease but at the same time the price mat increase.
If the problem is not solve, it will continue to occur which will slow down production;
putting majority out of a job and not seeking to improve our standard of living.
The Government can subsidize labour and continue to make the sector more attractive by
aggressive marketing and advertising campaign so it would not be a costly factor of
production. They could even influence people in the agricultural sector by providing
training and retraining for the farmers and assisit in the provision of capital.The
government should provide them irrigation facilities, post-harvest facilities, farm
equipments, farm to market roads, fertilizer and seed subsidies. The helps improve the
work and make it more attractive when there are full equipment’s so people can seek to
work in the sector
In return it adds more income to the nation and leads to better economy. It can also
become an exporter of processed agricultural products and even fresh farm harvest to
Farmers can train unskilled persons to expand their knowledge on the farm. Sellers of a
good increase the quantity supplied when the price decreases due to the fall input price or
even when technology improves. We then use the concept of elasticity to represent the
quantitative statement of supply that was qualitative.
Price Elasticity of Supply (PES) is a numerical measure of the responsiveness of supply
to a change in the price of the product alone (Mohammed and Bamford, 2007: 68). It can
be expressed as
PES= %∆Qs (% change in quantity supplied)
%∆P ( % change in price)
However, shortages of critical factor inputs such as skilled workers will often lead to
Inelastic Price Elasticity of supply; which is numerically represented by PES<1; meaning
that the percentage change in supply is less that the percentage change in price. This is
mainly occurs in situations that manages with agriculture products; such as in the case of
The following table assumes the supply of lettuces per month, is priced at $135.00, but
then the price rises to 160 as the quantity supplied increases from 900lbs to 1,000lbs.
Table 1: Shows the increase in price and in the quantity that is supplied.
Price Elasticity of Supply (PES) is then calculated by:
PES= Q1- Q2
PES is -0.58 which is inelastic when PED<1 (greater than zero, less than one)
This shows that quantity supplied changes by a smaller percentage that price does,
because farm products often have inelastic demands, large price fluctuation accompany
unplanned changes in production. Appropriate government intervention into agricultural
markets can reduce price fluctuation and stabilize producers’ revenues. Government
policies that stabilize prices at too high a level will cause excess supply, a rising level of
unsold stocks, and pressure for further government intervention to restrict output.
Quantity of lettuces
Figure 4: Price inelastic supply curve
However, supply is said to be inelastic because the quantity supplied responds only
slightly to the changes in the price. The price elasticity of supply depends on the
flexibility of sellers to change the amount of the good they produce. However, figure 8
has an Inelastic Supply because it is impossible to produce more potatoes. This is mainly
because of the time period where farmers in the short run; cannot easily change the size
of their inputs such as land and labour to make more potatoes. As well, when there are a
number of producers, it is easier for farmers to increase output in response to price
Destruction by Pests and Diseases
Certain pests and diseases greatly affect the farmers of Mayaro/ Rio Claro. The most
common pests and diseases include Nematodes and Black Sigatoka. The Nematodes is a
very detrimental cylindrical worm which sucks all the nutrients from the roots and stems
Additionally, the black Sigatoka damages the leaves of the plant especially that of the
plantain usually causing the plant to die altogether.
This is disaster for the farmers since these pest and disease impact upon the quality of the
crops for sale. As well, since the farmers will not be able to sell damaged items, the
quantity for sale will be reduced. When trees are destroyed by these pests and diseases
then less produce will be available for sale. The cost of production is also influenced,
since the farmers have to purchase pesticides, herbicide and other chemicals to alleviate
their problem. Therefore, all of those issues will lead to a decrease in supply and the cost
of buying chemicals to fall on the supply.
The diagram below, demonstrate the effects of a decrease in supply. We then assume that
S is the original amount supplied and S1 is the changed in the amount of Tomatoes
supplied, as the price increase.
Price($) P2 4
Quantity of Tomatoes (lbs)
A decrease in supply occurred because the cost of production has increased; thus which
lead to the cost of producing one unit of good to be higher. This occurs because the
farmer will have to employ greater means in order to prevent the pests and diseases that
affect their production. As well, equilibrium will be affected because as the quantity
provided is less it is being sold at a higher price.
Black Sigatoka should controlled by frequent applications of fungicides. Removal of
affected leaves, good drainage, and sufficient spacing also help to fight the disease.
Although fungicides improved over the years, the pathogen developed resistance.
Therefore higher frequency of application is required, increasing the impact on the
environment and health of the banana workers.
Small farmers growing bananas for local market cannot afford expensive measures to
fight the disease. This however could have an effect on the price of the bananas. Increase
cost of production will lead to higher price of the good.
The pie chart shows the percentage of farmers that are affected by pests and diseases in
Trinidad when compared to the number affected in the area of Mayaro/Rio Claro.
Pest and Diseases
Rest of Trinidad
Figure 6: Pest and Diseases
From the central statistical office’s data, 13% of the farmers from the Mayaro/ Rio Claro
area are affected by Pests and Diseases. This fairly large percentage and most times this
serves as a deterrent for farmers to continue in agriculture
Infrastructure and services to prevent and combat pests and diseases are a public good
that can be provided more efficiently by governments than by individual farmers. Yet, the
most effective form of government intervention depends on the pest or disease in
The justification for government control intervention is stronger for Tran’s boundary
pests and diseases than for those that only occur locally. Furthermore, in some countries
the loss of food as a result of pests and diseases may threaten food security or rural
livelihoods, making intervention politically unavoidable.
In the diagram below, this would lead to a leftward shift possibly to S2, the equilibrium
price will change and the quantity demanded will be less until it may not be supplied at
Quantity of Tomatoes
Figure 7:further shift in the supply of tomatoes
They could use natural methods such as ensuring that their crops is plated in proper
organic soil to eradicate pest and they could even join association , to lobby for better
conditions, for farmers’ rights and regulation. Practicing Mix Cropping which is growing
of two or more crops simultaneously on the same piece of land to discourage pest from
As assumptions were formerly made demonstrating the effects of a disease in supply; we
examined how it affected price by causing an increase, which occurred because of the
factor of high cost of production. However, the demand for agriculture produce can also
be affected by pest and diseases.
As demand changes, there is always likely to be a large or small impact on the
equilibrium.When consumers make choices about the quantity of goods and services to
consume, it is presumed that their objective is to maximize total utility which is the
aggregate level of satisfaction or fulfilment that a consumer receives through the
consumption of a specific good or service. In maximizing total utility, the consumer faces
a number of constraints, the most important of which are the consumer's income and the
prices of the goods and services that the consumer wishes to consume. The consumer's
effort to maximize total utility, subject to these constraints, is referred to as the
consumer's problem. The solution to the consumer's problem, which entails decisions
about how much the consumer will consume of a number of goods and services, is
referred to as consumer equilibrium. These changes can be understood by using the
concept of Elasticity; which is generally defined as a numerical measure of the
responsiveness of one economic variable following a change in another influencing
variable( Mohammed and Bamford, 2007 :49).
On the other hand, Price Elasticity of demand (PED) is a numerical measure of the degree
of responsiveness og the quantity demanded to a change in price. It can be
mathematically expressed as
PED= %∆Qd(% change in quantity demanded of a product)
(% change in price of that product)
For the purpose of this study, it has been assumed that price elasticity of demand for
tomato is inelastic, which is numerically represented by PES <1; meaning that the
percentage change in quantity demanded is less than proportionate to the percentage
change in price
The following table assumes that a 1,000 units of tomatoes per month, is priced at
$50.00, but then the price rises to $70 as the quantity demanded for the product falls
from 1,000lbs to 500lbs
(Q) Quantity demanded
Total revenue (TR=Q x P)
Table two: shows the increase in price and decrease in the quantity demanded
Price Elasticity of Demand (PED) is then calculated by:
PED= % ∆QD
PED= -0.1 which is inelastic when PED <1
Demand is the amount of a particular economic good or service that a consumer or group
of consumers will want to purchase at a given price. The demand curve is usually
downward sloping, since consumers will want to buy more as price decreases. Demand
for a good or service is determined by many different factors other than price, such as the
price of substitute goods and complementary goods.
Quantity of Tomato
Figure 8: price Inelastic Demand curve
When the price rises in order to offset higher production costs the decrease in quantity
demanded is less that proportionate to the increase in price, which results in an increase
in consumer’s expenditure in agriculture produce, in the case tomatoes.
Potential reasons for the assumptions made were because possible there were limited
substitutes available especially in the situation for agriculture products such as tomatoes;
which is therefore a prime necessity and because there is a small percentage of income
being spent which therefore result in demand being price inelastic.
Overall, even though farmers may face a subsequent loss due to pest and diseases, which
causes an increase in the marginal revenue refers to the additional revenue resulting from
the sales of one extra unit, whereas the total cost refers to the total cost of production.
Eventually, farmers will be able to recover a great percentage of the cost by increasing
price in order to increase their revenue because when PED<1 marginal revenue will be
negative, thus reducing total revenue.
Cowen Hamilton secondary school
I am a six form economic student from Cowen Hamilton secondary school; I
have been given the task to do a survey based on ‚An investigation into
problems faced by small farmers, in the areas of Mayaro/Rio claro.”I would
request you take part in this activity.
The answers should be answered with honesty as I will be using these answers
to analyse the overall data. The data is kept confidential and will share the
results once the analysis is finished.
This is aim to promote a better knowledge and understanding of the problems a
farmer may experience and the ways of how he/she would be able to deal with
In case you are uncomfortable with any question you can move on to answer the
next. Please be honest and make the survey Successful.
Please tick or write in the following questions that are given, to complete
1. Please tick your gender
2. As a small farmer, what type of production are you engaged in?
Both Crop and Animal
State the reason for your answer
3. Within the areas of Mayaro/Rio Claro, is destruction of your crops
or animals are being affected by plague(insects, birds etc.), your
If no, please state what is your main problem
4. Are you affected by flooding?
If yes, please state methods that are employed by you to alleviate it
as well as the loses experienced
5. Is the government putting enough emphasizing in the agriculture
sector by only granting subsidies to farmers?
Please state methods that can be implemented to help the sector
6. Are there high demands in the market for your produced?
If yes, state the difficulties involved with other farmers in the same
area with substitutes?
7. State the difficulties involved in supplying the produce
8. Do you think, if the government create a policy that will
discourage present farmers from selling your product?
State the reason for your answer
9. Are the crops or animals you grow affected by pests?
If yes, please state how you are to alleviate this problem
10. Is labour a problem in your business?
b) How many workers are employed within yourbusiness?
11. Is access to water the main problem in your area?
12. Which seasonal weather affects you mainly?
Please state whether there are losses or benefits
13. Is praedial larceny is a major problem in the farming committee?
What are some measures taken by you to prevent this?
14. Do you think that government should give subsidies to those
farmers, who are faced with problems( caused by natural
disasters, low labour productivity, lack of land title)?
15. Are you able to obtain a loan easily?
If yes, state where you were able to obtain your loan
16. How would you as a farmer, be able to help other farmers whom
are faced with the same problems as you have faced?
17. If the input of materials for your crops or animal production cost
raise. Would you increase the price?
18. Do taxes have a negative effect on your business?
State the reason for your answer
19. Are you satisfied with the budget 2013 initiative to promote a
‘Food Security Facilities’ the government of Guyana.
20. On average, do you make
Explain the reasons for your answer
21. Is your farm protected by any means of security( e.g surveillance
camera, watch men)/
If yes, please specify what mean(s) of security are used
22. Is there is lack of market space for your produce?
23. If a natural disaster were to destroy your crops or animals’
feeding grounds, how would you as a small farmer, be able to
compensate for your loses?
24. What are some other problems faced by you in your farming
25. Has technology impact on your farming techniques?
State the reason for your answer
The names of the farmers which the questionnaire was given to:
The person that I interviewed name is Kent Singh, lives in Mafeking Road Mayaro. He has been
a farmer for 20 years.
Mohammed and Bamford, 2007, Economic for cape.Cambridge University press
Bahaw, 2007 Cape economics comprehensive economics for Caribbean studies.
Lipsey and chrystal, 1999, principle of economic ninth edition
“Economic basics: Demand investopedia.” Investopedia- the web’s largest investing resource.
N.p., n,d. Web. 12 Mar. 2012. <http://www.investopedia.com/ university/
Kent Singh, 19/02/2013, 12:30pm Mafeking Road Mayaro, Crop farmer.