Question

Match List I with List - II.

List - I (Types of project costs)	List - II (Description of costs)
A. Associate costs B. Primary costs C. Indirect costs D. Nominal costs	I. Cost of producing immediate products/services II. Cost of indirect benefits/Social benefits III. Cost at current market price IV. Cost of the maintenance of the project

• A. A-IV, B-I, C-II, D-III
• B. A-III, B-IV, C-II, D-I
• C. A-I, B-IV, C-II, D-III
• D. A-III, B-I, C-II, D-IV

Hint:

Remember: "Nominal" always relates to current market prices, while "Primary" relates to the immediate output. This distinction helps narrow down matching options quickly in project cycle exams.

Answer 1

The Correct Option is A

Concept: Project management and appraisal in agriculture require a clear classification of costs to determine the economic viability and efficiency of an investment. Costs are classified based on their relationship to production, timing, and market value.

Step 1: Define Primary and Associate Costs.
Primary costs (B) are the direct expenses incurred for the actual production of goods or services (I). Associate costs (A) refer to the ongoing expenses required to keep the project operational, specifically the maintenance costs (IV).

Step 2: Define Indirect and Nominal Costs.
Indirect costs (C) are those that do not result directly from production but reflect social or secondary impacts (II). Nominal costs (D) represent the valuation of inputs and outputs at their current prevailing market prices (III), without adjusting for inflation or shadow pricing.

Step 3: Final Matching.
A-IV, B-I, C-II, D-III. This matches Option (1).