What should your pricing policy be to maximize profits

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You are the manager of a pizza parlor that produces at a marginal cost of $6 per pizza. The parlor is a local monopoly near campus (there are no other restaurants or food stores within 50 miles). During the day, only students eat at your restaurant. In the evening, while students are studying, faculty members eat there. If students have an elasticity of demand of -4 and the faculty have an elasticity of demand of -2, what should your pricing policy be to maximize profits?

Reference no: EM13186834

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