Reconsider the common resource problem given in Example 18.7. Suppose that crawfish popularity continues to increase, and that the demand curve shifts from C = 0.401 – 0.0064F to C = 0.5-0.0064F, where F is the catch of crawfish in millions of pounds and C is the cost in dollars per pound. In addition, you are given the marginal social cost equation C = - 5.645 + 0.6509F, and the marginal private cost equation C = - 0.357 +0.0573F. How does this shift in demand affect the actual crawfish catch, the efficient catch, and the social cost of common access? The actual crawfish catch is 13.45 million pounds of crawfish. (Enter your answer rounded to two decimal places.) The efficient catch is 9.35 million pounds of crawfish. (Enter your answer rournded to two decimal places.) The social cost of common access is $: (Enter your answer rounded to two decimal places.)

Reconsider the common resource problem given in Example 18.7. Suppose that crawfish popularity continues to increase, and that the demand curve shifts from C = 0.401 – 0.0064F to C = 0.5-0.0064F, where F is the catch of crawfish in millions of pounds and C is the cost in dollars per pound. In addition, you are given the marginal social cost equation C = - 5.645 + 0.6509F, and the marginal private cost equation C = - 0.357 +0.0573F. How does this shift in demand affect the actual crawfish catch, the efficient catch, and the social cost of common access? The actual crawfish catch is 13.45 million pounds of crawfish. (Enter your answer rounded to two decimal places.) The efficient catch is 9.35 million pounds of crawfish. (Enter your answer rournded to two decimal places.) The social cost of common access is $: (Enter your answer rounded to two decimal places.)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Is my answer correct? 13.45 and 9.35? And, the last question, how to find the social cost of common access ($)? Thank you.

Reconsider the common resource problem given in Example 18.7. Suppose that crawfish popularity continues to increase, and that the demand curve shifts from
C = 0.401 – .0064F
to
C = 0.5-0.0064F,
where F is the catch of crawfish in millions of pounds and C is the cost in dollars per pound. In addition, you are given the marginal social cost equation
C = - 5.645 + 0.6509F,
and the marginal private cost equation
C = – 0.357 + 0.0573F.
How does this shift in demand affect the actual crawfish catch, the efficient catch, and the social cost of common access?
The actual crawfish catch is 13.45 million pounds of crawfish. (Enter your answer rounded to two decimal places.)
The efficient catch is 9.35 million pounds of crawfish. (Enter your answer rounded to two decimal places.)
The social cost of common access is $ . (Enter your answer.rounded to two decimal places.)

Definition Definition Total cost incurred by the producers of goods and services as well as anyone who is impacted by the production of the commodity in terms of external cost.

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