Cinema theater has estimated the following demand functions

Reference no: EM13377716

Cinema Theater has estimated the following demand functions for its movies:

Daytime demand, QD = 400 - 50 PD
Nighttime demand, QN = 200 - 20 PN

The marginal cost of serving another customer is $5 and its fixed costs are $100.

a. If the theater uses third degree price discrimination, what price will it charge for daytime tickets? How many will be sold?

b. If the theater uses third degree price discrimination, what price will it charge for nighttime tickets? How many will be sold?

c. What is the profit associated with using third degree price discrimination?

d. If the theater does not use price discrimination and charges the same price to all customers, what is that price and how many tickets will be sold?

e. What happens to profit when the theater does not engage in third degree price discrimination? How much does it rise or fall?

Reference no: EM13377716

Questions Cloud

When the price of sugar was low consumers in the united : when the price of sugar was low consumers in the united states spent a total of 1 billion annually on its consumption.

When the price of corn was low consumers in the united : when the price of corn was low consumers in the united states spent a total of 3 billion annually on its consumption.

Ae the various exchange-rate systems floating : analyze the various exchange-rate systems floating managed floating adjustable pegged and crawling pegged and

Recent increases in rents have caused the citizens of : recent increases in rents have caused the citizens of elmville to vote for a rent ceiling of 1200. assuming all rental

Cinema theater has estimated the following demand functions : cinema theater has estimated the following demand functions for its moviesdaytime demand qd 400 - 50 pd nighttime

Given the current economic situation determione the steps : given the current economic situation determione the steps the federal reserve should take to help stabilize our

Your niece just started her college career with a major in : your niece just started her college career with a major in economics. she is curious as to the interrelationship

Gm announced that it will close its oshawa truck plant : gm announced that it will close its oshawa truck plant in 2009 and a windsor transmission plant in 2010. ford

Suppose that kiribati can produce 1000 tons of : suppose that kiribati can produce 1000 tons of breadfruit or 500 tons of fish and that tuvalu can produce 750

User Account

All Pages