Suppose that, because of an increase in world demand, the price of the fish from this fishery rises significantly. Illustrate and explain the impact of this price-increase on the fish stock and the competitive level of effort (or employment) in the fishery. What can be said about the long-run impact on the fish catch? Is it positive, negative, or indeterminate? Explain.

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Accounting and Economic Profit analysis

One comes across the concept of Profits in the context of business and in analyzing the results of business activity. Profits of a business can be accounting profits, and they can also be economic profits. So how does one understand the concept of accounting versus economic profits?