Suppose Bull Gator Ben has paid his $14,300 donation and purchased eight season tickets at $32 per game. He discovers that he only needs seven tickets, and sells the eighth ticket for $150. Although he sold a ticket for $150, did he make a profit on the sale? (Hint: Compare what Ben paid to his revenue from selling the ticket)
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- Question 10 Which of the following startements about network externalities is CORRECT? Air pollution is an example of a network externality. For a good with network externalities, the number of people who are willing to buy a unit of the good is uniquely determined by the price. Network externalities are always positive. The manufacturer of a new good with network externalities might give away a free version of the good. For a good with network externalities, one person's valuation of the good is always increasing in the number of other people using the good.The following table shows how much utility Taran gets from watching his favorite teams, measured in "utils" (units of satisfaction). Team Manchester United Seattle Kraken Seattle Mariners. Seattle Seahawks Seattle Sounders. Seattle Storm Utils 68 81 78 64 72 86 Suppose Taran can only watch one of his favorite teams play. Assuming the cost to watch each team is the same, which team will Taran choose to watch?The Chicago Bears offer what are essentially two products: preseason and regular season football games. They play 2 preseason and 8 regular season home games. Suppose that Fred is a serious football fan. He values the preseason games at $140 each and the regular season games at $220 each. Joe is a more casual fan. He values the preseason games at $170 each and the regular season games at $180 each. Suppose that Fred and Joe are the only fans. If the Bears sell the tickets separately, the price of a ticket to a preseason game will be $ 140 The price of a ticket to a regular season game will be $ 180 Total revenue that the Chicago Bears collect will be $ 3440 If the Bears bundle tickets for the two preseason and eight regular season games together, the price the team will set for the bundle is S. Total revenue that the Chicago Bears collect will be S Should the Bears' managers sell the tickets separately or as a bundle? O A. The Bears should sell the tickets separately because they earn…
- Homework (Ch 05) On the following graph, use the green point (triangle symbol) to plot the weekly total revenue when the market price is $50, $75, $100, $125, $150, $175, and $200 per scooter. TOTAL REVENUE (Dollars) 7830 7290 6750 8210 5670 5130 4590 4050 3510 2970 0 25 50 75 100 125 150 175 200 225 250 275 300 325 PRICE (Dollars per scooter) Total Revenue gage Learning According to the midpoint method, the price elasticity of demand between points A and B is approximately Suppose the price of scooters is currently $25 per scooter, shown as point B on the initial graph. Because the demand between points A and B is a $25-per-scooter increase in price will lead to in total revenue per week. In general, in order for a price increase to cause a decrease in total revenue, demand must beUse the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. Graph Input Tool Market for Triple Sevens's Hotel Rooms 500 I Price (Dollars per room) 450 200 400 Quantity Demanded (Hotel rooms per night) 300 350 300 250 Demand Factors 200 150 Average Income (Thousands of dollars) Demand 50 100 Airfare from LAX to LAS (Dollars per roundtrip) 50 100 + 50 100 150 200 250 300 350 400 450 500 QUANTITY (Hotel rooms) Room Rate at Exhilaration (Dollars per night) 250 For each of the following scenarios, begin by assuming that all demand factors are set to their original values and Triple Sevens is charging $200 per room per night. If average household income increases by 10%, from $50,000 to $55,000 per year, the quantity of rooms demanded at the Triple Sevens from rooms per night to rooms per…You own Naughty Pine lumber and sell fence panels in a competitive market. Right now, your selling price is $130 for a fence panel, and you sell 8 panels a day. You are considering changing your price. You estimate that if you raise your price to $152 a panel, you would sell 7 panels a day. On the other hand, if you lower your price to $108 a panel, you would sell 12 panels a day. (a) Draw a graph of the above information. Label your axes, and the curve. Be sure your work is clear. (b) Use the MIDPOINT FORMULA to calculate Ed over the ranges below. Use TWO decimals in your answers. (i)Calculate the price elasticity of demand for a price change from $130 to $152 and daily Total Revenue if you change your price to $152 a panel (ii)Calculate the price elasticity of demand for a price change from $130 to $108 and daily Total Revenue if you change your price to $108 a panel Should you keep your current price, or raise the price, or lower the price?
- Omar's Fruit Shop sells only apples and bananas. Each week, Omar puts either apples or bananas on sale. He is trying to figure out which fruit he should put on sale this week. Omar gets all of his business from people who walk by his fruit shop and stop in. He performs some market research and asks 800 different people if they would purchase apples, bananas, or no fruit if they walked by and apples were on sale. He does the same for bananas being on sale. This week a total of 400 people will walk by Omar's Fruit Shop. The following table shows the profit for each type of fruit depending on which fruit Omar puts on sale: Apples on sale Bananas on sale Profit from apples $0.25 $0.40 Profit from bananas $0.45 $0.30 The following table shows the results from his market research. Customer choice Apples on sale Bananas on sale Apples 604 92 Bananas 90 620 No fruit 106 88 Total 800 800 What is Omar's expected profit if he puts apples on sale? What is Omar's…6. Exercise 4.6 An econometrician hired to analyse a local golf course has determined that there are two types of golfers, the regular and the occasional. The annual demand for games from regular players is given by QH = 24 - 0.3P, where P is the price of a round of golf. On the other hand, the annual demand for occasional items is given by Q° = 10 - 0.1P. The marginal cost and the average total cost per item are equal to €20. a) If you could distinguish between regular and casual players, what price would be set for each type? How many games would each type of player play? How much profit could the golf course generate? Represent graphically. b) As an alternative to the discrimination of third degree prices, those in charge consider a double tranche rate according to which the members can play as many games as they wish at a price of € 20 per game. How much profit will the golf course generate if it charges all players the same annual fee for becoming a member of the club? What if you…4. The profit earned from selling the quantity Q1 at P1 is Profit1 = ____________________(identify the area on the graph and calculate it).5. The profit earned from selling the quantity Q2 at P2 is Profit2= ____________________(identify the area on the graph and calculate it).6. The total profit earned by the price discriminating monopolist is Profit = Profit1 + Profit2 = _______.
- At the end of performances of his Broadway play, "Cyrano de Bergerac," Kevin Kline, who starred as Cyrano, the cavalier poet with a huge nose, auctioned his prosthetic proboscis, which he and his co-star, Jennifer Garner, autographed to benefit Broadway Cares in its fight against AIDS. An English auction was used. One night, a television producer grabbed the nose for $1,400, while the next night it fetched $1,600. On other nights it sold for $3,000 and $900. Why did the value fluctuate substantially from night to night? The value of the nose fluctuated from night to night because the bidders have private values for the auction item. Which bidder's bid determined the sales price? The bidder whose value determined the sales price was the bidder. second-lowest second-highest lowest highestAt the end of performances of his Broadway play, "Cyrano de Bergerac," Kevin Kline, who starred as Cyrano, the cavalier poet with a huge nose, auctioned his prosthetic proboscis, which he and his co-star, Jennifer Garner, autographed to benefit Broadway Cares in its fight against AIDS. An English auction was used. One night, a television producer grabbed the nose for $1,400, while the next night it fetched $1,600. On other nights it sold for $3,000 and $900. Source: (Mitchell, Dan, "This Time, Santa Has Been Too Naughty," New York Times, December 9, 2007) Why did the value fluctuate substantially from night to night? The value of the nose fluctuated from night to night because the bidders have Which bidder's bid determined the sales price? The bidder whose value determined the sales price was the How was the auction price affected by the audience's knowledge that the proceeds would go to charity? Why? Since proceeds went to the AIDS charity, private values OA. differed by each bidder's…There is often only one major league baseball team in a city. What effect does this have on ticket prices?
