An agricultural cooperative plans to train 200 farm workers. Each training costs ₹1,200 per worker. After training, each worker’s daily production increases from 40 to 48 units. Each unit of produce is sold at ₹8. Calculate: (a) the total annual cost of the training program; (b) the annual increase in revenue generated by the cooperative; (c) the simple payback period in years.

Step-by-step solution

1. Compute total cost: 200 × ₹1,200 = ₹240,000. (Annual cost)
2. Compute daily increase per worker: 48 – 40 = 8 units. (Daily increase)
3. Compute annual increase per worker: 8 × 365 = 2,920 units. (Annual increase)
4. Compute total annual increase: 2,920 × 200 = 584,000 units. (Total increase)
5. Compute revenue increase: 584,000 × ₹8 = ₹4,672,000. (Revenue)
6. Compute payback period: cost ÷ revenue increase = ₹240,000 ÷ ₹4,672,000 = 0.0514 years ≈ 0.05 years. (Payback).

Concept tested: Return on training investment

Published 13 October 2026 · How this solution was prepared and checked