Question: A small firm traps rabbits for their fur and feet. Each rabbit yields one pelt and two feet (only the hind feet are used to make good-luck charms). The demand for pelts is given by

P p = 2.00 -0.001Q p

And the demand for rabbit’s feet is given by

P f = 1.60 -0.001Q f

The marginal cost of trapping and processing each rabbit is $0.60.

1. What are the profit-maximizing prices and quantities of pelts and rabbit’s feet?
2. If the demand for rabbit’s feet is P f = 1.00 -0.001Q f , what are the profit-maximizing prices and rates of output?

Price: $2.99

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