Policymakers, farmers, managers of agriculture and others look to agricultural economists for accurate estimates of the costs and returns of individual agricultural commodities. But there is great diversity and disagreement among practitioners about the best method for such analysis. The contributors to this volume explore how different uses of estimates determine different methods of estimation, as well as evaluating what the preferred methods are for similar uses.

Extract: A survey of feedlot farms in Egypt shows important variations in operational characteristics, costs, and returns among regions, different sizes of operation, and management systems. Overall, the degree of feedlot utilization was low, less than 70 percent of capacity. Weight gain per day for local breed was lower than for foreign and crossbreeds (1 to 15 percent). Budget analysis showed that the return to average producers covers variable costs and leaves a margin to fixed factors and management, especially for private feedlots. Differences in farm management decisions, on types and weights of animals entering and leaving feedlots, and types of feed ration had a significant effect on costs and returns to farmers.

The relationship of stock returns and trading volume is the focus of much recent interest. I examine an economic model of a rational trader who operates in a market with transactions costs and noise trading. The level of trading affects the rational trader’s marginal cost of transacting; as a result, trading volume is a source of risk. This engenders an equilibrium relationship between returns and volume. The model also provides a simple way to scrutinize this relationship empirically. Empirical evidence supports the implications of the model.