Demand for blue-fin tuna Price ($/lb)Quantity demanded (lbs) 30700 60600 90500 120400 150300 180200 A fishing boat just returned from the sea with its hold full of blue-fin tuna. The demand for blue-fin tuna is given in the table above. This boat is the only one that has blue-fin tuna for sale this day. The boat captain is considering asking $ 150 per pound of his tuna. His first mate disagrees and argues for asking $120 per pound. What is the elasticity of demand for tuna between the price/quantity point the captain prefers and the one the first mate prefers? Is the demand between the two points from part (a) elastic or inelastic? Which price would result in higher sales revenue?Suppose the total amount of tuna they have to sell is 500 lbs. and all unsold fish will spoil overnight. Given this new information, what should the fishermen charge for their tuna? Assume they are trying to maximize revenue from selling their catch (since they already have incurred all the costs of catching the fish).

1. The quantity demanded at the price of $150 per pound is given to be 300 pounds. The captain of…

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ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Demand for blue-fin tuna

Price ($/lb)	Quantity demanded (lbs)
30	700
60	600
90	500
120	400
150	300
180	200

A fishing boat just returned from the sea with its hold full of blue-fin tuna. The demand for blue-fin tuna is given in the table above. This boat is the only one that has blue-fin tuna for sale this day. The boat captain is considering asking $ 150 per pound of his tuna. His first mate disagrees and argues for asking $120 per pound. What is the elasticity of demand for tuna between the price/quantity point the captain prefers and the one the first mate prefers?
Is the demand between the two points from part (a) elastic or inelastic? Which price would result in higher sales revenue?
Suppose the total amount of tuna they have to sell is 500 lbs. and all unsold fish will spoil overnight. Given this new information, what should the fishermen charge for their tuna? Assume they are trying to maximize revenue from selling their catch (since they already have incurred all the costs of catching the fish).

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