3. Lobsters are harvested throughout the year in New Hampshire. In the winter months, lobster fishing is slow. Some lobster fishers stop fishing entirely over the winter. Others continue to fish but report earning a loss during these months.

a. Identify at least five costs associated with lobster fishing (you can either do research or just take an educated guess). Categorize each cost as fixed or variable and explain why you categorize the cost in this way. Be sure to include at least one example from each category.

b. Using the theory of the shutdown point, explain how economics can help a fisher decide at what point in the Fall season to stop fishing. Under what circumstances does it make sense for fisher to keep harvesting lobster even though they are making a loss? Be sure to explain carefully.