Economic Analysis of Tobacco Profitability in District Swabi

Abstract

Economic profitability of production of tobacco in Swabi, KPK, Pakistan was investigated through the structured questionnaire and personal interview method during 2013 from five purposively selected villages. 65 sampled respondents were investigated during the study. Farm budgeting technique was applied to estimate cost, gross return and net revenue. Economic analysis revealed that the average cost was Rs. 348637.18 acre^-1 with the average tobacco output estimate to be 3,244.73 kg acre^-1 and average gross revenue of Rs. 430348.54 acre^-1, whereas the average net revenue (net profit) was estimated to be Rs. 81711.36 acre^-1. The regression analysis of profit function displays that cost, quantity of yield and price of the yield were the main factors of profit (net revenue) determination.

Keywords: Tobacco;Net revenue;Cost of production; Regression.