1. Suppose that there are 1200 units of a nonrenewable resource available over two periods (0 and 1). Demand in each period is given by P = 2000 – Z. Marginal cost is constant at 400. The discount rate is 10 percent. - (a) What is the dynamically efficient allocation of the 1200 units of the nonrenewable resource, and what will be the prices in the two periods?

1. Suppose that there are 1200 units of a nonrenewable resource available over two periods (0 and 1). Demand in each period is given by P = 2000 – Z. Marginal cost is constant at 400. The discount rate is 10 percent. - (a) What is the dynamically efficient allocation of the 1200 units of the nonrenewable resource, and what will be the prices in the two periods?

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter4: Markets In Action

Section: Chapter Questions

Problem 8SQP

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