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Chapter 31: Q. 10 (page 708)

The table below shows the estimated annual total costs and benefits of maintaining Asian elephant populations in their natural habitat.

Short Answer

Expert verified

The new optimal point would be 37500elephants.

Step by step solution

01

introduction

Subtracting the preceding cost or benefit yields the marginal cost or benefits a. Determine the marginal cost and benefit as follows:

02

step 2  The marginal cost and benefit of Asian elephant conservation:

The following table shows the marginal cost and benefit of Asian elephant conservation:

03

step 3  Graph showing in marginal cost and marginal benefit:

04

step 4  The optimal position is

b. The optimal position is where the marginal cost and benefit are equal. When the marginal benefit and cost are equal to 25, this happens with 30000 elephants.

05

the marginal benefit and marginal cost for 7500 would be: 

C.

If the benefit is reduced by $10million and the marginal cost is reduced by $40million for each 7500elephants, the marginal benefit and marginal cost for7500would be:

The new optimal point would be 37500elephants.

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Most popular questions from this chapter

Explain why 100 per cent air cleanliness is not optimal.

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b. When the optimal percentage degree of water cleanliness has been attained, what cost will be incurred for the last unit of water cleanup?

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