Abstract

The aim of the paper is to develop an optimization model to support the analysis of decision-making on Macedonian family farms. Normative linear programming paradigm is applied, utilising its optimization potential. The model is applied on a hypothetical vegetable farm case. The optimal structure in all scenarios indi cates that the optimal solution is the production of tomato, pepper, cabbage, carrot and bean. The base scenario reveals a gross margin of 17,924 € which is highest compared to other scenarios. The working capital available is a binding constraint in second and third scenario, where the optimal solution reveals that the land resource is not exhausted. Gross margin sensitivity was examined using the working capital parameterisation. The model is quite flexible thus enabling different crop enterprises to be added additionally.

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