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28 Sep 2019
Suppose you want to remove ten fish of an exotic species thathave illegally been introduced to a lake. You have three possibleremoval methods. Assume that q1+q2+q3=10.
a) If the marginal costs of each removal method are respectively$15q1, $7.5q2, and $2.5q3 how much of each method should you use toachieve the removal cost-effectively?
b) Why isn't exclusive use of method 3 cost-effective?
c) Suppose that the three marginal costs were constant (notincreasing as the previous case) such that MC(1)=$15, MC(2)=$7.5and MC(3)=$2.5. What is the cost effective outcome in thatcase?
Suppose you want to remove ten fish of an exotic species thathave illegally been introduced to a lake. You have three possibleremoval methods. Assume that q1+q2+q3=10.
a) If the marginal costs of each removal method are respectively$15q1, $7.5q2, and $2.5q3 how much of each method should you use toachieve the removal cost-effectively?
b) Why isn't exclusive use of method 3 cost-effective?
c) Suppose that the three marginal costs were constant (notincreasing as the previous case) such that MC(1)=$15, MC(2)=$7.5and MC(3)=$2.5. What is the cost effective outcome in thatcase?
Hubert KochLv2
28 Sep 2019