Cost of capturing a cockatoo and transporting

Reference no: EM13685970

Presume that the cost of capturing a cockatoo and transporting him to the United States is about $40 per bird. Cockatoos are smuggled and drugged in suitcases to the United States. Half of the smuggled cockatoos die in transit. Each smuggled cockatoo has a 10 percent probability of being discovered, in which case the smuggler is fined. If the fine imposed for each smuggled cockatoo is increased to $700, then the equilibrium price of cockatoos in the United States will be what?

a. $61. b. $244.44. c. $75. d. $110. e. $155.56

Reference no: EM13685970

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