The Puritan Wellness Hotel sits next to the natural springs in the Silver Forest. Local firm Refectio Deorum (RD) bottles mineral water only from this source. Guests of the Puritan can bathe in the springs, and are charged for the privilege. The inverse demand function is P = 50 - Q, where Q is the number of daily bathers who purchase the pass to the springs. The Puritan incurs no costs when its guests use the springs, but RD estimates that every bather adds $20 in daily filtering expenses. What is the privately optimal number of bathing passes to sell for the Puritan, and what is the socially optimal number of passes? A. Privately optimal is 25 passes; socially optimal is 15 passes. B. Privately optimal is 40 passes; socially optimal is 75 passes. C. Privately optimal is 100 passes; socially optimal is not to bathe at all. D. The optimal number of hours, privately as well as socially, is 50.

As a manager of a chain of movie theaters that are monopolies in their respective markets, you have noticed much higher demand on weekends than during the week. You therefore conducted a study that has revealed two different demand curves at your movie theaters. On weekends, the inverse demand function is P = 35 -0.001Q; on weekdays, it is P = 25-0.002Q. You acquire legal rights from movie producers to show their films at a cost of $25,000 per movie, plus a $3.00" royalty" for each moviegoer entering your theaters (the average moviegoer in your market watches a movie only once). What type of pricing strategy should you consider in this case? multiple choice Block pricing First degree price discrimination Third degree price discrimination Second degree price discrimination What price should you charge on weekends? Instructions: Enter your response rounded to two decimal places. $ What price should you charge on weekdays? Instructions: Enter your response rounded to two decimal places. $

Sal's satellite company broadcasts TV to subscribers in Los Angeles and New York. The demand functions for each of these two groups are QNY =40-0.2PNY QLA=80-0.5PLA where Q is in thousands of subscriptions per year and P is the subscription price per year. The cost of providing Q units of service is given by C = 1000 + 60Q where Q Suppose Sal can charge only a single price. QNY + QLA %3D What price should he charge, and what quantities will he sell in New York? A. $115.71, 18 В. $130, 14 C. $110, 25 D. $115.71, 22

Suppose that BMW can produce any quantity of cars at a constant marginal cost equal to $20,00 and a fixed cost of $10 billion. You are asked to advise the CEO as to what prices and quantities BMW should set for sales in Europe and in the United States. The demand for BMWs in each market is given by   QE=4,000,000−100PE and QU=1,500,000−20PU   where the subscript E denotes​ Europe, the subscript U denotes the United States. Assume that BMW can restrict U.S. sales to authorized BMW dealers only.     a.  What quantity of BMWs should the firm sell in each​ market, and what should the price be in each​ market? What should the total profit​ be? ​ (round dollar amounts to the nearest penny and quantities to the nearest​ integer) In Europe equilibrium quantity is 1,000,000 cars at an equilibrium price of $30,000 In United States equilibrium quantity is 550,000 cars at an equilibrium price of $47,500 BMW makes a total profit of $15.125 billion.  I Need help with this part: If BMW were forced…

A firm is a profit-maximizing monopolist in the market of a patented computer software. As an economic analyst,you observe the following data:a) The monopoly’s price is set at $50 per copy.b) The monopoly’s total revenue is $300,000.c) The monopoly’s marginal cost at the profit-maximizing quantity is at $30 per copy.Based on the observed data, please determine the linear inverse demand function.Fill in the blanks. Suppose the inverse demand function is of the formwhere a, b are both positive constants, determine the value for a: 1 and b: 2 .Hint: a should be an integer, the answer for b should round to four decimal places.

For each of the following scenarios, begin by assuming that all demand factors are set to their original values and that Triple Sevens is charging $200 per room per night. If average household income increases by 20%, from $50,000 to $60,000 per year, the quantity of rooms demanded at the Triple Sevensrises   from   rooms per night to   rooms per night. Therefore, the income elasticity of demand is    , meaning that hotel rooms at the Triple Sevens are    .

The function that relates the inverse of speed (1/S) (i.e., the time in minutes that it takes to travel 1 mile) to traffic (T) on a highway is 1/S = 4 + 0.05T. Demand for traffic (measure as traffic volume minute) on this road is T=6880-70 (1/S) Find the equilibrium traffic volume in the absence of any congestion toll. Find the marginal cost function for traffic volume, where cost is expressed as travel time per mile in minutes. per Find the optimal level of traffic volume. Find the optimal congestion toll, expressed in minutes. (Imagine that the congestion toll consists of sitting in the “penalty box" for this period of time.) The function that relates the inverse of speed (1/S) (i.e., the time in minutes that it takes to travel 1 mile) to traffic (T) on a highway is 1/S = 4 + 0.05T. Demand for traffic (measure as traffic volume per minute) on this road is T=6,880- 70-(1/S). a. Find the equilibrium traffic volume in the absence of any congestion toll. b. Find the marginal cost…

"Tiffany" is a retailer monopolist who makes a unique product called the "diamond ring" that requires exactly one diamond as input, which is sold by a wholesaler monopolist, the "Diamond Corporation". Diamond Corporation faces a marginal cost of £60 per unit of input (this is also the firm's average cost). Assume that "Tiffany" faces the following inverse demand curve for diamond rings: Pt 320 – Qt where Pt is the price of red diamond rings in pounds per unit and Qt is the quantity of diamond rings offered for sale by "Tiffany". Similarly, Diamond Corporation charges a price, Pa, for the inputs in £ per unit and Qa is the quantity of inputs sold by Diamond Corporation. a) Derive the profit-maximising price and output for both firms, assuming that the two monopolists act as independent profit-maximising companies. Calculate profits of each firm. Use a clear diagram to illustrate your answers to explain your calculations. b) Now assume that the two firms merge. Calculate the post-merger…

The FIA ​​Formula 1 World Championship to be held during the 2021 Mexico City Grand Prix has a total cost function equal to CT = Q33 + Q2 + 125Q and an inverse demand function of P = 200−2Q. Now suppose there is a new company managing this event, so the total cost function becomes CT = 4Q. This new company intends to sell at two different prices depending on the place that the spectators occupy at the Hermanos Rodríguez Autodrome. For the Red Zone Boxes. The estimated demand will be q1 = 32−12p1 and for the Green Zone Boxes  It will be q2 = 42 − p2. The number of tickets sold for the Red Zone and Green Zone will be: 15; 84 23; 16 15; 19 33; 45

[Suppose] A Cmpany is the sole provider of electricity in the various districts of Dubai. To meet the monthly demand for electricity in these districts, which is given by the inverse demand function: P = 1,200 − 4Q, the company has set up two electric generating facilities: Q1 kilowatts are produced at facility 1 and Q2 kilowatts are produced at facility 2;        where Q = Q1 + Q2.       The costs of producing electricity at each facility are given by C1(Q1) = 8,000 + 6Q1 C2(Q2) = 6,000 + 3Q2 + 5Q22   What is the MR function?  What is the MC function of each facility? What is the MC function of the firm?