Conner runs two kinds of rafting trips. If he spends all day on a wild whitewater rafting, he can do 3 trips, or he can do 4 trips of a mellow wildlife rafting. If he does some of each, however, he can do more total trips: 2 whitewater trips and 3 wildlife trips. Conner’s time is valued at $20/hour. Finding the value for the economies of scope of Conner’s rafting experience. What can you say about his economies of scope? i.e., does Conner reduce the average cost by making some of each trip or by making each trip separately? Show your work.
Conner runs two kinds of rafting trips. If he spends all day on a wild whitewater rafting, he can do 3 trips, or he can do 4 trips of a mellow wildlife rafting. If he does some of each, however, he can do more total trips: 2 whitewater trips and 3 wildlife trips. Conner’s time is valued at $20/hour. Finding the value for the economies of scope of Conner’s rafting experience. What can you say about his economies of scope? i.e., does Conner reduce the average cost by making some of each trip or by making each trip separately? Show your work.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Conner runs two kinds of rafting trips. If he spends all day on a wild whitewater rafting, he can do 3 trips, or he can do 4 trips of a mellow wildlife rafting. If he does some of each, however, he can do more total trips: 2 whitewater trips and 3 wildlife trips. Conner’s time is valued at $20/hour.
Finding the value for the economies of scope of Conner’s rafting experience.
What can you say about his economies of scope? i.e., does Conner reduce the average cost by making some of each trip or by making each trip separately? Show your work.
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