Homework Help is Here – Start Your Trial Now!
Business
Economics
costs

costs

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
See similar textbooks
icon
Related questions
Question
100%

Please help me with d. Thanks!

Kara and Kyle are competing sockeye salmon fishers. They have been allocated ITQS (individual transferable quotas) that limit their total catch to 2,000 tons of sockeye salmon per fisher. Kara's costs of catching salmon are $6 per ton, and Kyle's costs are $10 per ton. Instructions: Enter your answers as a whole number. a. If the market price of sockeye salmon is $15 per ton, and Kara and Kyle both catch their quota, what will be their combined profit? $ 28,000 b. What is the maximum amount Kara would be willing to pay per ton for Kyle's ITQS? 2$ 9 O per ton c. What is the minimum amount per ton that Kara would have to offer Kyle to convince him to sell his ITQS to her? 5 per ton d. If Kara pays Kyle $6 per ton for his ITQS, and if she then catches her new limit of 4,000 tons, what will be their combined profit? 2$
Transcribed Image Text:Kara and Kyle are competing sockeye salmon fishers. They have been allocated ITQS (individual transferable quotas) that limit their total catch to 2,000 tons of sockeye salmon per fisher. Kara's costs of catching salmon are $6 per ton, and Kyle's costs are $10 per ton. Instructions: Enter your answers as a whole number. a. If the market price of sockeye salmon is $15 per ton, and Kara and Kyle both catch their quota, what will be their combined profit? $ 28,000 b. What is the maximum amount Kara would be willing to pay per ton for Kyle's ITQS? 2$ 9 O per ton c. What is the minimum amount per ton that Kara would have to offer Kyle to convince him to sell his ITQS to her? 5 per ton d. If Kara pays Kyle $6 per ton for his ITQS, and if she then catches her new limit of 4,000 tons, what will be their combined profit? 2$
Expert Solution
steps

Step by step

Solved in 2 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Market Demand
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Recommended textbooks for you
ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
Economics
ISBN:
9780190931919
Author:
NEWNAN
Publisher:
Oxford University Press
Principles of Economics (12th Edition)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS