The Table Given Below Represents the Marginal Valuation of a Beekeeper

question 31

Multiple Choice

The table given below represents the marginal valuation of a beekeeper (collecting honey) and an orchard farmer (producing mangoes) .The beekeeper's opportunity cost reflects the loss in honey collection resulting from the usage of the same orchard again and again.

$\begin{array}{|c|c|c|c|c|c|}\hline \text { Days used } & \begin{array}{c}\text { Total honey } \\\text { value }(\$) \end{array} & \begin{array}{c}\text { Marginal } \\\text { honey value } \\(\$) \end{array} & \begin{array}{c}\text { Beekeeper's } \\\text { opportunity cost } \\(\$) \end{array} & \begin{array}{c}\text { Total value } \\\text { of mangoes } \\\mathbf{( \$ ) }\end{array} & \begin{array}{c}\text { Marginal value } \\\text { of mangoes (\$) }\end{array} \\\hline 1 & 18 & 18 & 4 & 10 & 10 \\\hline 2 & 23 & 6 & 4 & 17 & 7 \\\hline 3 & 27 & 5 & 4 & 23 & 6 \\\hline 4 & 30 & 3 & 4 & 28 & 5 \\\hline 5 & 32 & 2 & 4 & 32 & 4 \\\hline 6 & 33 & 1 & 4 & 30 & 2 \\\hline 7 & 34 & 1 & 4 & 29 & 1 \\\hline\end{array}$

-Refer to Table .What would be the maximum number of days for which the orchard owner would wish to keep the beekeeper in the orchard by paying him a compensation which is sufficient to cover the latter's opportunity cost?

• A)5 days
• B)7 days
• C)More than 7 days
• D)3 days

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Definitions:

Income Effect

The alteration in income for a person or the economy and the resulting influence on the demand for a certain good or service.

Substitution Effect

The economic principle indicating how consumers react to a change in price by substituting a more expensive item with a cheaper alternative.

Price

The total money demanded to secure a good or service.

Delphiniums

A genus of flowering plants known for their tall spikes of colorful flowers, often used in gardens and floral arrangements.