Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

suppose that there are only two fishermen, Zach and Jacob, who fish along a certain coast.they would each benefit if lighthouses were built along the

suppose that there are only two fishermen, Zach and Jacob, who fish along a certain coast.they would each benefit if lighthouses were built along the coast where the fish. the maginal cost of building each additional lighthouses is $100. the marginal benefit to zach of each additional lighthouses is 90-Q, and the marginal benefit to jacob is 40-Q, where Q equals the number of lighthouses.

A) Explain why we might not expect to find the efficient number of lighthouses along this coast ?

B) What is the efficient number of lighthouses? What would be the net benefits to Zach and Jacob if the efficient number were provided?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Introductory Econometrics For Finance

Authors: Chris Brooks

2nd Edition

052169468X, 9780521694681

More Books

Students also viewed these Finance questions

Question

Do you usually feel alert when you wake up in the morning? Yes No

Answered: 1 week ago