What number of passengers will maximize profit

Reference no: EM13694586

A major airline estimates that the demand and marginal revenue functions for first class and excursion fares from New York to Paris are: First Class: P = 4,200 – 2Q MR = 4,200 – 4Q Excursion: P = 2,200 – .25Q MR = 2,200 – .5Q If the marginal cost of production is $200 per passenger, what fare and what number of passengers will maximize profit? Show that profit is greater than if the airline used a single or uniform price.

Reference no: EM13694586

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