A farmer couple has a chance to rent some farmland for $300 per acre. They put together the following budget (per tillable acre). Show your work for partial credit. Expected annual gross income from crops $1,000 Expected input costs (seed, fertilizer, pesticides, drying) $420 Machinery and labor costs $210 Cash rent $300 a. How much is their expected profit per acre if they cash rent the farm? _/tillable acre b. How much is their expected profit per acre under a traditional 50-50 crop share lease? I _/tillable acre c. How much would their expected profit per acre be if they rented the land on a flexible cash lease where the base rent is $225, and a bonus equal to 40% of the gross income over $850 is added? $ $ /tillable acre d. What is the maximum amount they could pay for rent (calculate the tenant's residual)? $ /tillable acre e. How much would the land be worth using the income approach to valuing land, if the discount rate is 4.0% and ownership costs (property taxes and upkeep) in addition to production costs are $40 per acre? $ /tillable ac acre f. How much would their net cash flow from the land be if they bought it with a $8,000 per acre loan and their annual payment was $375 per acre? / tillable acre