For Each Carload of Ore Removed from the Matchless Mine

question 27

Multiple Choice

For each carload of ore removed from the Matchless Mine, 1 pound of lead and 1 ounce of silver is smelted. The cost of mining and processing 1 carload of ore is C(Q) = 700 + 2Q + 0.09Q². The demand for silver (per ounce) is P_s = 40 - 0.30Q_s and the demand for lead (per pound) is P_l = 5 - 0.02Q_l. What should the owners of the Matchless Mine do to maximize profits (in the long run) ?

• A) Mine and process 52.44 carloads of ore, sell 52.44 ounces of silver, and sell 52.44 pounds of lead.
• B) Mine and process 66.67 carloads of ore, sell 66.67 ounces of silver, and sell 13.64 pounds of lead.
• C) Mine and process 125 carloads of ore, sell 66.67 ounces of silver, and sell 125 pounds of lead.
• D) Mine and process 125 carloads of ore, sell 48.72 ounces of silver, and sell 125 pounds of lead.
• E) Shut down the mine.

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Definitions:

Technological Advance

The progression or improvement in technology, leading to enhanced productivity, efficiency, or quality in goods and services.

Economy

The system by which goods and services are produced, distributed, and consumed within a particular area or country.

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Fundamental choices or determinations made to guide actions, policies, or strategies, often in businesses or personal planning.

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The large set of inter-related production, consumption, and exchange activities that aid in determining how scarce resources are allocated.