Joe enjoys fishing & goes out about 20 times per year. One day, Sara told him th

Question

Joe enjoys fishing & goes out about 20 times per year. One day, Sara told him that fishing is too expensive of a hobby. She thinks he should stop going because she calculated that it costs about %28.75 for every fish he catches because he usually catches about 20 fish per trip. She says it would be much cheaper to buy fish from the market.

Comment on Sara's remarks. Do you agree with her argument? Explain. (below are her cost estimates)

Boat $150.
(cost=$30,000, usable for 10 years, 20 outings per year)
Boat Fuel $45.
Dock Fees & Insurance for the Boat (average per trip) $130.
Travel Expenses to & From the Lake $25.
(100 miles @ $0.25 per mile: gas, oil & tires,
$0.18, & depreciation & insurance, $0.07)
New Fishing Equipment Purchases this Year(pro-rated over 20 trips) $25.
Annual Fishing License $35.
Bait & Miscellaneous Expenses $50
Food $40
Beverages $35
Traffic Fine recieved on the Way to the Lake $40
Total Cost per Trip = $575

Explanation / Answer

The argument is based on certain assumptions which should be questioned.

(a)That the amount of money that can be saved by selling the boat equals # of years for which it can be used multiplied by one-tenth of the purchaseprice.

(b)Depreciation is double-counted – it is included in travel expenses as well as in costs of the boat.

(c)The new fishing equipment is assumed to need replacing each year.

(d)Food and beverages should only be counted to the extent that they increase if fish are caught compared with if they are bought.

Related Questions

Navigate

• Browse (All)
• Browse J
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.