Determine the optimal strategy for the breeder, Microeconomics

Assignment Help:

Consider a decision faced by a cattle breeder. The breeder must decide how many cattle he should sell in the market each year and how many he should retain for breeding purposes.  Suppose the breeder starts with a herd of 200 cattle. If he breeds cattle, he obtains 1.4 times as many cattle per year as he started with.  The cost of breeding is $30 for each head of cattle not sold.  Breeding takes one year, and the $30 cost includes all expenses of maintaining an animal and its offspring.  Alternatively, the breeder may sell cattle in the market, at a price which depends on how many cattle he sells.  If Y represents the number of cattle which are sold in a given year, then the Price, P, is given by the following equation:

       P = 200 - 0.2Y,        0 ≤Y ≤ 1,000

Start at the end of the actual decision process and represent the size of the herd in year 10 as x10. The herd is to be sold at $150 per head at the beginning of year 10 and consider f10(x10)= 150 x10.

Assume that the breeder plans to sell his entire herd at the beginning of 10 years from now and retire.  Determine the optimal strategy (of breeding and selling in the market place) for the breeder over the next ten years using dynamic programming, so that his profits are maximised at the time of retirement.


Related Discussions:- Determine the optimal strategy for the breeder

Production and cost and market structures, In the long-run equilibrium, eac...

In the long-run equilibrium, each firm in a perfectly competitive industry will choose the plant size associated with minimum long-run average cost. Is this TRUE or FALSE? And why?

Elasticities of demand:, price of laptop increases by 20% and there is a 40...

price of laptop increases by 20% and there is a 40% drop in the quantity demanded?

Explain about the deadweight loss and elasticitie, Explain about the deadwe...

Explain about the deadweight loss and elasticitie s. Deadweight Loss and Elasticities The general rule for economic policy is the other things equivalent; you need to choose

Political economy, #question.Now suppose nation A has RA resources in its t...

#question.Now suppose nation A has RA resources in its treasury and nation B has RB resources. The winning coalition in each nation is WA and WB respectively. Leaders want to survi

Imposition of behavior assumptions in analytical framework, Illustrate abou...

Illustrate about the imposition of behavior assumptions in analytical frameworks of modern economics? Imposition of Behavior Assumptions: The second one step for studying

Homework, the difference between an lc3 and other types of businesses is th...

the difference between an lc3 and other types of businesses is that

Trade, Ask question #Minim1. what items should be put on the agenda of a ne...

Ask question #Minim1. what items should be put on the agenda of a new round of trade talks (and who wants these on the agenda), 2. why, and 3. the problems likely to be met in the

Calculating ratios from annual report, i need to find Profitability, Earnin...

i need to find Profitability, Earning capacity, Capital structure, Robustness from annual reports. Not a long job..

Normal and abnormal profits., the diagram used to illustrate abnormal and n...

the diagram used to illustrate abnormal and normal progits

Asian development bank, ASIAN DEVELOPMENT BANK; In addition to the Wor...

ASIAN DEVELOPMENT BANK; In addition to the World Bank family, there are three other international lending agencies operating only in specific geographical area, but run on lin

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd