A mining company’s land concession in Angola incorporates five major mines that extract copper. The productivity of each mine is as follows:

The company must decide how many mines to operate.
Assume each mine is identical in size and variable costs of mining copper in each are $18 million per year. The variable costs cover labor and machinery, which is rented. In 2014, the average price of copper was $3.50 per pound. By 2015, the price of copper had fallen to $2.00 per pound.
How will it affect the company’s decision? How will it affect its demand for labor? How will it affect the value of the company’s land concession?

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Annual Yield (in Pounds) Mine 1 Mine 2 Mine 3. Mine 4 Mine 5 18 million 11 million 8 million 5 million 4 million