Suppose that at first, Bob charges the same price of $4 per admission in both markets so that the total number of admissions demanded isSuppose now that Bob decides to charge a different price in each market. To maximize revenue, Bob should chargein Market A and $per admission in Market B. At these prices, he will sell a total quantity ofComplete the following table by calculating Bob's total revenue from selling in both markets under the nondiscriminatory as well as the discriminatoryprice policy.Price PolicyNondiscriminatoryDiscriminatoryTotal Revenue$$Bob charges a lower price in the market with a relativelyper admissionadmission tickets per day.price elasticity of demand. Bob owns a plot of land in the desert that isn't worth much. One day, a giant meteor falls on his property. The event attracts scientists and tourists,and Bob decides to sell nontransferable admission tickets to the meteor crater to both types of visitors: scientists (Market A) and tourists (Market B).The following graphs show demand (D) curves and marginal revenue (MR) curves for the two markets. Bob's marginal cost of providing admissiontickets is zero.PRICE (Dollars per ticket)10mCD200Market AMRIIIII1 2 3 45 6 7 8 9QUANTITY (Admission tickets per day)DA10?PRICE (Dollars per ticket)10CDN00Market BMRDB B1 2 3 4 5 6 7 8 9QUANTITY (Admission tickets per day)10(?)

You may determine just how much money your company makes before expenses by looking at its total…

uppose now that Bob decides to charge a different price in each market. To maximize revenue, Bob should charge $ per admission in Market B. At these prices, he will sell a total quantity of [ Market A and $ Complete the following table by calculating Bob's total revenue from selling in both markets under the nondiscriminatory as well as the discrimin rice policy. Price Policy Nondiscriminatory Discriminatory Total Revenue $ $ ob charges a lower price in the market with a relatively per admi admission tickets per price elasticity of demand.

uppose now that Bob decides to charge a different price in each market. To maximize revenue, Bob should charge $ per admission in Market B. At these prices, he will sell a total quantity of [ Market A and $ Complete the following table by calculating Bob's total revenue from selling in both markets under the nondiscriminatory as well as the discrimin rice policy. Price Policy Nondiscriminatory Discriminatory Total Revenue $ $ ob charges a lower price in the market with a relatively per admi admission tickets per price elasticity of demand.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Rajiv owns a plot of land in the desert that isn't worth much. One day, a giant meteorite falls on his property, making a large crater. The event attracts scientists and tourists, and Rajiv decides to sell nontransferable admission tickets to the meteor crater to both types of visitors: scientists (Market A) and tourists (Market B). The following graphs show daily demand (D) curves and marginal revenue (MR) curves for the two markets. Rajiv's marginal cost of providing admission tickets is zero. PRICE (Dollars per ticket) 20 18 16 14 12 10 0 0 3 Market A D₁ MR 6 9 12 15 15 21 24 27 30 QUANTITY (Admission tickets) ? PRICE (Dollars per ticket) 20 18 16 0 0 3 Market B MR D 6 9 12 15 18 21 24 27 QUANTITY (Admission tickets) 30
Lucia owns a plot of land in the desert that isn't worth much. One day, a giant meteorite falls on her property, making a large crater. The event attracts scientists and tourists, and Lucia decides to sell nontransferable admission tickets to the meteor crater to both types of visitors: scientists (Market A) and tourists (Market B). The following graphs show daily demand (D) curves and marginal revenue (MR) curves for the two markets. Lucia’s marginal cost of providing admission tickets is zero. Suppose that at first, Lucia charges the same price of $4 per admission in both markets so that the total number of admissions demanded is______tickets. Suppose now that Lucia decides to charge a different price in each market. To maximize revenue, Lucia should charge_________per admission in Market A and________per admission in Market B. At these prices, she will sell a total quantity of _________admission tickets per day. Complete the following table by calculating…
Eric owns a plot of land in the desert that isn't worth much. One day, a giant meteorite falls on his property, making a large crater. The event attracts scientists and tourists, and Eric decides to sell nontransferable admission tickets to the meteor crater to both types of visitors: scientists (Market A) and tourists (Market B). The following graphs show daily demand (DD) curves and marginal revenue (MRMR) curves for the two markets. Eric's marginal cost of providing admission tickets is zero. PRICE (Dollars per ticket) 20 18 16 9 09 2 0 0 1 Market A MR 2 3 4 5 6 7 8 QUANTITY (Admission tickets) Pricing Policy Nondiscriminatory Discriminatory D 0 10 Total Revenue (Dollars) PRICE (Dollars per ticket) 20 18 18 14 12 10 8 4 2 0 0 1 low Market B Imagine that at first, Eric charges the same price of $8 per admission in both markets so that the total number of admissions demanded is Tickets. Imagine now that Eric decides to charge a different price in each market. To maximize revenue, Eric…
Susan owns a plot of land in the desert that isn't worth much. One day, a giant meteorite falls on her property, making a large crater. The event attracts scientists and tourists, and Susan decides to sell nontransferable admission tickets to the meteor crater to both types of visitors: scientists (Market A) and tourists (Market B). The following graphs show daily demand ( DD ) curves and marginal revenue ( MRMR ) curves for the two markets. Susan's marginal cost of providing admission tickets is zero.
Price-discriminating firm Cho owns a plot of land in the desert that isn’t worth much. One day, a giant meteor falls on her property. The event attracts scientists and tourists, and Cho decides to sell nontransferable admission tickets to the meteor crater to both types of visitors: scientists (Market A) and tourists (Market B). The following graphs show demand (D) curves and marginal revenue (MR) curves for the two markets. Cho’s marginal cost of providing admission tickets is zero. I hope you can see a clear picture.
You decide to create a burger restaurant named BurgerDeals to help pay for college fees. The table below contains total pricing information for your single product, large extra-cheese burger. Your town's burger market is fiercely competitive, with big extra-cheese burger selling for $7 on average. Fill in the blanks in the table and answer the following question. If you produce at the profit-maximizing level (or loss-minimizing level), what is the amount of economic profit (or loss) per burger will you make?
Monopoly outcome versus perfectly competitive outcome Consider the daily market for hot dogs in a small city. Suppose that this market is in long-run perfectly competitive equilibrium, with many hot dog stands in the city, each one selling the same kind of hot dogs. Therefore, each vendor is a price taker and possesses no market power. The following graph shows the demand (D) and supply curves (S = MC) in the market for hot dogs. Place the black point (plus symbol) on the graph to indicate the market price and quantity that will result from perfect competition. Use the green point (triangle symbol) to shade the area that represents consumers’ surplus, and use the purple point (diamond symbol) to shade the area that represents producers’ surplus. (graph 1) Assume that one of the hot dog vendors successfully lobbies the city council to obtain the exclusive right to sell hot dogs within the city limits. This firm buys up all the rest of the hot dog vendors in the city and…
Black Box Cable TV is able to purchase an exclusive right to sell a premium movie channel (PMC) in its market area. Let's assume that Black Box Cable pays $150,000 a year for the exclusive marketing rights to PMC. Since Black Box has already installed cable to all the homes in its market area, the marginal cost of PMC to subscribers is zero. The manager of Black Box needs to know what price to charge for the PMC service to maximize her profit. Before setting price, she hires an economist to estimate demand for the PMC service. The economist discovers that there are two types of subscribers who value premium movie channels. First are the 4000 die-hard TV viewers who will pay as much as $150 a year for the new PMC premium channel. Second, the PMC channel will appeal to about 20,000 occasional TV viewers who will pay as much as $25 a year for a subscription to PMC. Refer to Scenario 15-3. What is the deadweight loss associated with the nondiscriminating pricing policy compared to the…
Scenario 15-7 Black Box Cable TV is able to purchase an exclusive right to sell a premium movie channel (PMC) in its market area. Let's assume that Black Box Cable pays $75,000 a year for the exclusive marketing rights to PMC. Since Black Box has already installed cable to all of the homes in its market area, the marginal cost of delivering PMC to subscribers is zero. The manager of Black Box needs to know what price to charge for the PMC service to maximize her profit. Before setting price, she hires an economist to estimate demand for the PMC service. The economist discovers that there are two types of subscribers who value premium movie channels. First are the 4,000 die-hard TV viewers who will pay as much as $150 a year for the new PMC premium channel. Second, the PMC channel will appeal to 20,000 occasional TV viewers who will pay as much as $20 a year for a subscription to PMC. Refer to Scenario 15-7. If Black Box Cable TV is able to price discriminaté, what would be the maximum…
The figure below illustrates the market for steel. If the steel market is competitive, firms can produce steel at a constant marginal cost of $100 per ton. Therefore, the price of steel is $100 per ton, and 100 tons are produced. Assume that if all the steel companies consolidate into a monopoly, the monopoly marginal cost will fall to $70 per ton. Use the straight line tool to draw the monopoly marginal revenue and marginal cost lines (extend the marginal cost line to 300 tons). Then use the plot point tool to plot the monopoly profit maximizing price and output on the demand curve. Part 2. If the market is competitive, total surplus is $ _________ Part 3. If the market is controlled by a monopoly, total surplus is $________
Scenario 15-7 Black Box Cable TV is able to purchase an exclusive right to sell a premium movie channel (PMC) in its market area. Let's assume that Black Box Cable pays $150,000 a year for the exclusive marketing rights to PMC. Since Black Box has already installed cable to all of the homes in its market area, the marginal cost of delivering PMC to subscribers is zero. The manager of Black Box needs to know what price to charge for the PMC service to maximize her profit. Before setting price, she hires an economist to estimate demand for the PMC service. The economist discovers that there are two types of subscribers who value premium movie channels. First are the 4,000 die-hard TV viewers who will pay as much as $150 a year for the new PMC premium channel. Second, the PMC channel will appeal to 20,000 occasional TV viewers who will pay as much as $20 a year for a subscription to PMC. Refer to Scenario 15-7. What is the deadweight loss associated with the nondiscriminating pricing…
You decide to create a burger restaurant named BurgerDeals to help pay for college fees. The table below contains total pricing information for your single product, large extra-cheese burger. Your town's burger market is fiercely competitive, with big extra-cheese burger selling for $7 on average. Fill in the blanks in the table and answer the following question. What is AVC if you produce 6 burgers?