Business
Business, 29.04.2021 18:50, lovely222

Imagine that two oil companies, BQ and Exxoff, own adjacent oil fields. Under the fields is a common pool of oil worth $144 million. Drilling a well to recover oil costs $5 million per well. If each company drills one well, each will get half of the oil and earn a $67 million profit ($72 million in revenue - $5 million in costs). Assume that having X percent of the total wells means that a company will collect X percent of the total revenue. If BQ were to drill a second well, what would its profit be if Exxoff did not drill a second well

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Imagine that two oil companies, BQ and Exxoff, own adjacent oil fields. Under the fields is a common...

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