Multiple Choice
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 $7; Kyle's cost per ton is $11. Assume that the market price of sockeye salmon is $16 per ton. If Kara pays Kyle $6 per ton for his ITQs, and if she then catches her new limit of 4,000 tons, her profit would be
A) $18,000.
B) $14,000.
C) $24,000.
D) $38,000.
Correct Answer:
Verified
Correct Answer:
Verified
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