Fruit-tree based agroforestry represents a more environmentally friendly system, the economic returns and adoption determinants of which have only been modestly studied to date. This study investigated the determinants of practicing fruit-tree based agroforestry and the associated costs incurred and returns earned by practitioners. It contrasted the economic performance of agroforestry based systems versus monocropping systems using economic performance indicators at the household level in Wondo District. Data were collected from 149 selected households through structured interviews, focus group discussions, key informant interviews, market assessments as well as field observation. Variables including nearness to the main road, farming experience, labor, landsize and income significantly affected the practice of fruit tree based agroforestry system. Attention is needed in the design of policies and strategies for promoting the fruit-tree based agroforestry system which is more attractive financially, in addition to being labor saving and less risky investment than the monocropping systems.
Key words: Agroforestry, annual equivalent value, benefit cost ratio, cost benefit analysis, net present value.
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