Imagine We Are Catching Fish from a Small Pond That

question 2

Multiple Choice

Imagine we are catching fish from a small pond that contains 6 catfish, 10 perch, and 4 walleye. When we catch a fish, we return it to the water so it may be caught again. Individuals of all species are equally likely to be caught, and fish are no more or less likely to be caught a second time than they were the first. What is the probability of catching a catfish, followed by a perch, followed by a walleye in the first three catches?

• A) 0.007
• B) 0.015
• C) 0.021
• D) 0.030

---

Definitions:

Marginal Cost Function

A mathematical representation showing how the cost of producing one additional unit of a good changes as production volume changes.

Optimal Output

The level of production that maximizes a firm’s profit or minimizes its cost under given conditions.

Profit

The financial gain acquired when the revenue generated from business activities exceeds the expenses, costs, and taxes needed to sustain the activity.

Industry Supply Curve

A graph that shows the relationship between the price of a good and the total output of the industry for that good.