2. Suppose retail water demand is given by wa = 70-p and the marginal cost of retail water is mc = 0.00125w². Currently the supplier cannot fulfill the quantity demanded under marginal-cost pricing, because natural water is in short supply. Suppose that only 32 units of natural water are available. Due to system leakage and evaporation, the relationship between natural water pumped and retail water received is Wntrl - 10 1.1 What is the value of an action to increase natural water availability to 43 units? Wrtl=

ENGR.ECONOMIC ANALYSIS
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70 – p and the marginal cost of retail water is
2. Suppose retail water demand is given by wa
mc = 0.00125w?. Currently the supplier cannot fulfill the quantity demanded under marginal-cost
pricing, because natural water is in short supply. Suppose that only 32 units of natural water are
available. Due to system leakage and evaporation, the relationship between natural water pumped
and retail water received is
Wntri – 10
Wrtl
1.1
What is the value of an action to increase natural water availability to 43 units?
Transcribed Image Text:70 – p and the marginal cost of retail water is 2. Suppose retail water demand is given by wa mc = 0.00125w?. Currently the supplier cannot fulfill the quantity demanded under marginal-cost pricing, because natural water is in short supply. Suppose that only 32 units of natural water are available. Due to system leakage and evaporation, the relationship between natural water pumped and retail water received is Wntri – 10 Wrtl 1.1 What is the value of an action to increase natural water availability to 43 units?
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