Suppose That a Cost-Benefit Model Is Given By $f ( x ) = \frac { 3.5 x } { 100 - x }$

question 72

Essay

Suppose that a cost-benefit model is given by $f ( x ) = \frac { 3.5 x } { 100 - x }$ where f(x) is the cost in thousands of dollars of removing x percent of a given pollutant. What is the vertical asymptote of the graph of this function? What does this suggest about the possibility of removing all of the pollutant? Explain your
reasoning.

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Definitions:

Behavioral Economists

Specialists in economics focusing on how psychological, emotional, cultural, and social factors influence the economic decisions of individuals and institutions.

Realized Losses

Losses that occur when an asset is sold for less than its purchase price, thereby converting a theoretical loss into an actual loss.

Aversion

A strong dislike or disinclination towards something, often used in economics in the context of risk aversion.

Overconfidence

The bias in which someone's subjective confidence in their judgements is greater than their objective accuracy.