When more than one by-product from joint production has no alternatives for production, all these by-products will be considered separately determinants. Here is an example where "more than one by-product has no alternatives for production". Further procedures and examples on how to calculate the consequences of a change in demand for one of the determinants products will be presented in an upcoming lesson.
Production of chicken meat
The production of chicken meat involves the presence of 6 by-products: dark meat, breast, wings, inedible parts, head and feet, blood, and feathers.
The dark meat, breast, and wings are what we normally consider the main result. There is only one way to obtain these chicken cuts, through poultry production. These three by-products (dark meat, breast, and wings) must be considered determinants as none of them has an alternative production route. The other three by-products (inedible offal, heads and feet, blood, and feathers) enter the pet food production market, where alternative raw materials are available (mainly soy proteins). To identify the consequences of an isolated increase in demand for each of the three determinant by-products, they need to be analyzed separately.
Next lesson - Lesson "Marginal Suppliers"
