Question
Suppose it costs $48 for each lobster trap set. Lobsters sell for $12. If X traps are set, the harvest rate of lobsters, L, as
Suppose it costs $48 for each lobster trap set. Lobsters sell for $12. If X traps are set, the harvest rate of lobsters, L, as a function of the number of traps, is given by:
L = 12X -X2.
a.With no restrictions (competitive markets exist) on the number of traps, and open access to the waters, how many traps will be set? How many lobsters will be harvested? How much profit will be realized from lobstering?
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Microeconomics
Authors: David Besanko, Ronald Braeutigam
5th edition
1118572270, 978-1118799062, 1118799062, 978-1118572276
