Assuming a multi period model of non- renewable resources in a perfectly competitive market,

explain how the optimal price of the non-renewable resource and optimal time for the resource to

be exploited is affected by:

a) Increase in interest rate (5mks)

b) Decrease in resource stock (5mks)

c) Decrease in demand for the resource (5mks)

d) Fall in price of a backstop technology (5mks)