Imagine that two oil companies, Big Petro Inc. and Gargantuan Gas, own adjacent oil fields. Under the fields is a common pool of oil worth $24 million. Drilling a well to recover oil costs $2 million per well. If each company drills one well, each will get half of the oil and earn a $10 million profit ($12 million in revenue - $2 million in costs). If a company has X per cent of the total wells, then it will collect X per cent of the total revenue.
-According to the information provided, if Big Petro Inc. were to drill a second well, what would its profit be if Gargantuan Gas did not drill a second well?

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The Answer of Imagine that two oil companies, Big Petro Inc. and Gargantuan Gas, own adjacent oil fields. Under the fields is a common pool of oil worth $24 million. Drilling a well to recover oil costs $2 million per well. If each company drills one well, each will get half of the oil and earn a $10 million profit ($12 million in revenue - $2 million in costs). If a company has X per cent of the total wells, then it will collect X per cent of the total revenue.
-According to the information provided, if Big Petro Inc. were to drill a second well, what would its profit be if Gargantuan Gas did not drill a second well?

Imagine That Two Oil Companies, Big Petro Inc