A large mountain area in Western Norway has very favorable wind conditions andopportunity to establish a wind farm for the production of electric powerwhich can be sold in the European power market. The company Power has previouslygained the exclusive right to develop the area for power production. Let x be the number ofdmøller set up in the area. The area is used by many people asrecreation area, and is close to a major city.Power's profit depends on how many wind turbines set up. Letthe profit be given byIP (X) = 100x - 5x 2Two groups are negatively affected by the wind turbine development, the local populationgen and the local tourism industry that sells adventure travel to foreign countriestourists. The value of the local population of the area given by the following function1V L (x) = V 0 - 30x -X 22The tourism industry's profit is given by the following functionπτ(x) πο- 10x-1X 2 c) The tourism industry contacts Power and asks them to reduce the number ofdmøller in their development plans. They sit down at negotiationsthe table. How many wind turbines will they agree to build (round off tonearest whole number)? Explain why such an agreement would have to involvethat the tourism industry pays Power to reduce the number of wind turbines. Whatis the smallest amount the tourism industry has to pay to get Poweron the agreement? What is the maximum amount the tourism industry can stretchto pay for the deal?d) Despite these negotiations between the tourism industry and Powermore the angry reader post from the citizens who think their voicenot heard. The municipality takes self-criticism and suggests that they go intothe same negotiations with Power. Explain why such an initiativewelcomed by both Power and the tourism industry. How will thischange the outcome of the negotiations, ie how many wind turbines will they agree onthat Power should build? What is the minimum amount the tourism industry andthe municipality as a whole must pay to get Power on the agreement? remember thatPower already has an agreement with the state that gives the company a full right toto build as many wind turbines as they want.

Wind turbine is a device that converts the wind's kinetic energy into electrical energy. There is…

A large mountain area in Western Norway has very favorable wind conditions and opportunity to establish a wind farm for the production of electric power which can be sold in the European power market. The company Power has previously gained the exclusive right to develop the area for power production. Let x be the number of dmøller set up in the area. The area is used by many people as recreation area, and is close to a major city. Power's profit depends on how many wind turbines set up. Let the profit be given by TIP (X) = 100x - 5x 2 Two groups are negatively affected by the wind turbine development, the local population gen and the local tourism industry that sells adventure travel to foreign countries tourists. The value of the local population of the area given by the following function 1 VL (x) = V 0 - 30x - 2 The tourism industry's profit is given by the following function пт (х) %3D по- 10х- 1 X 2

A large mountain area in Western Norway has very favorable wind conditions and opportunity to establish a wind farm for the production of electric power which can be sold in the European power market. The company Power has previously gained the exclusive right to develop the area for power production. Let x be the number of dmøller set up in the area. The area is used by many people as recreation area, and is close to a major city. Power's profit depends on how many wind turbines set up. Let the profit be given by TIP (X) = 100x - 5x 2 Two groups are negatively affected by the wind turbine development, the local population gen and the local tourism industry that sells adventure travel to foreign countries tourists. The value of the local population of the area given by the following function 1 VL (x) = V 0 - 30x - 2 The tourism industry's profit is given by the following function пт (х) %3D по- 10х- 1 X 2

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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