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Amount of Fish Caught

The document describes a production schedule for a trawler that shows the amount of fish caught per week increases with crew size. It states the owner can sell fish for $75 per 100 lbs and pay crew $150 per week. To maximize profits, the owner should determine the optimal crew size. The solution shows calculations of total revenue, total costs, and total profit for different crew sizes. It determines the optimal crew size is 8 workers, which generates a maximum profit of $1,125.

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206 views

Amount of Fish Caught

The document describes a production schedule for a trawler that shows the amount of fish caught per week increases with crew size. It states the owner can sell fish for $75 per 100 lbs and pay crew $150 per week. To maximize profits, the owner should determine the optimal crew size. The solution shows calculations of total revenue, total costs, and total profit for different crew sizes. It determines the optimal crew size is 8 workers, which generates a maximum profit of $1,125.

Uploaded by

Anonymous sMqylH
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Answer on Question #44112 Economics Microeconomics

The amount of fish caught per week on a trawler is a function of the crew size assigned to operate
the boat. Based on past data, the following production schedule was developed:
CRRW SIZE(Number of workers) Amount of Fish caught per week (Hundreds of LBS)
Supposed the owner of the trawler can sell all the fish caught for $75 per 100 pound and can hire as
many crew members as desired by paying them $150 per week. Assuming that the owner of the
trawler is interested in maximising profits, determine the optimal crew size.

Solution

N, workers Q, hundreds MP, AP, hundreds TR=$75*Q TC=$150*N TP=TR-TC


of LBS hundreds of of LBS
LBS
2 3 - 1.5 $225.00 $300.00 -$75.00
3 6 3 3 $450.00 $450.00 $0.00
4 11 5 5.5 $825.00 $600.00 $225.00
5 19 8 9.5 $1 425.00 $750.00 $675.00
6 24 5 12 $1 800.00 $900.00 $900.00
7 28 4 14 $2 100.00 $1 050.00 $1 050.00
8 31 3 15.5 $2 325.00 $1 200.00 $1 125.00
9 33 2 16.5 $2 475.00 $1 350.00 $1 125.00
10 34 1 17 $2 550.00 $1 500.00 $1 050.00
11 34 0 17 $2 550.00 $1 650.00 $900.00
12 33 -1 16.5 $2 475.00 $1 800.00 $675.00

P = $75 per 100 LBS, w = $150 per worker.


Total profit equals: TP = TR TC, TC = N*w, TR = P*Q, where TR total revenue,
TC total cost, P price, Q hundreds of LBS, w fisher salary, N number of
workers.
The maximal profit is $1125, when 8 or 9 workers are used. To avoid access costs
using additional workers and assuming that the owner of the trawler is interested in
maximizing profits, the optimal crew size is 8 workers, when the profit equals $1125.

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