(Transcript of audio with descriptions. Transcript includes narrator headings and description headings of the visual content)
(Speaker)
This problem is going to analyze the fishing decisions of two fishing fleets from the US en EU fishing in the waters of the North Antlantic.
(Description)
The table consists of 2 columns: Price of fish (per pound), Quantity of fish demanded (pounds).
The table consists of 5 rows.
The first row: Price of fish is, 17 dollars per pound, Quantity of fish demanded is, 1800 pounds.
The second row: Price of fish is, 16 dollars per pound, Quantity of fish demanded is, 2000 pounds.
The third row: Price of fish is, 15 dollars per pound, Quantity of fish demanded is, 2100 pounds.
The fourth row: Price of fish is, 14 dollars per pound, Quantity of fish demanded is, 2200 pounds.
The fifth row: Price of fish is, 12 dollars per pound, Quantity of fish demanded is, 2300 pounds.
The following text is briefly written above the table:
To preserve the North Atlantic fish stocks, it is decided that only two fishing fleets, one from the United States and the other from the European Union (EU), can fish in those waters. The accompanying table shows the market demand schedule per week for fish from these waters. The only costs are fixed costs, so fishing fleets maximize profit by maximizing revenue.
The following text is briefly written below the table:
If both fishing fleets collude, what is the revenue maximizing output for the North Atlantic fishery? What price will a pound of fish sell for? It may help to calculate total revenue.
(Speaker)
The problem is going to ask you calculate revenue when the two fleets cooperate in their production decision but also if fleets decide to deviate.
Here you can see the price of fish per pound for each level of fish demand and caught by the two fleets.
We are going to start out by assuming both fleets will collude to maximize total revenue.
(Description)
An additional column labeled Total Revenue (price per round times total pounds) is added to the right side of the table. Cells in this column are blank.
The following text is briefly written above the table:
If both fishing fleets collude, what is the revenue maximizing output for the North Atlantic fishery? What price will a pound of fish sell for? It may help to calculate total revenue.
(Speaker)
In order to determine how many pounds of fish to catch and the resulting price, we are going to calculate total revenue.
Total revenue is found by multiplying the price by total fish demanded.
(Description)
A cell at the intersection of the first row and the column Total Revenue is, equals 17 dollars times 1800 equals 30 thousand 600 dollars.
A cell at the intersection of the second row and the column Total Revenue is, equals 16 dollars times 2000 equals 32 thousand dollars.
A cell at the intersection of the third row and the column Total Revenue is, equals 15 dollars times 2100 equals 31 thousand 500 dollars.
A cell at the intersection of the fourth row and the column Total Revenue is, equals 14 dollars times 2200 equals 30 thousand 800 dollars.
A cell at the intersection of the fifth row and the column Total Revenue is, equals 12 dollars times 2300 equals 27 thousand 600 dollars.
These cells are briefly highlighted.
(Speaker)
You can see the total revenue highlighted in the table. Since the two fishing fleets can collude, they will choose to jointly catch fish where total revenue is greatest.
We can see total revenue is highest if they catch 2000 pounds of fish, which they can sell at 16 dollars per pound.
(Description)
The second row of the table is highlighted. Cells with Price of fish is, 16 dollars per pound, Quantity of fish demanded is, 2000 pounds, are labeled as If both EU and US cooperate, they will catch 2000 pounds and charge 16 dollars per pound.