Kara and Kyle are competing sockeye salmon fishers. Both have been allocated ITQs that limit their catch to 2,000 tons of sockeye salmon each. Kara's cost per ton is $8; Kyle's cost per ton is $12. Refer to the information given and assume that
the market price of sockeye salmon is $15 per ton. If Kara pays Kyle $5 per ton for his ITQs, and if she then catches her new limit of 4,000 tons, their combined profit would be:
A. $18,000.
B. $22,000.
C. $20,000.
D. $4,000.
Answer: A
Economics
You might also like to view...
The measure of production that values production using current prices is called
A) nominal GDP. B) value-added GDP. C) real GDP. D) underground GDP.
Economics
Interest rates are positive because
A) people prefer future consumption over current consumption. B) people prefer current consumption over future consumption. C) usury laws require rates to be very high. D) banks are not competitive.
Economics