6. Problems and Applications Q6 You live in a town with 300 adults and 200 children, and you are thinking about putting on a play to entertain your neighbors and make some money. A play has a fixed cost of $1,000, but selling an extra ticket has zero marginal cost. Here are the demand schedules for your two types of customers: Price (Dollars) 10 9 8 76543NTO 2 0 Adults (Tickets) 0 50 100 150 200 250 300 300 300 300 300 Children (Tickets) 0 0 0 0 0 50 100 150 200 200 200 To maximize profit, you would charge $ ticket. Total profit in this case would be $ Now you set a price of $ for an adult's ticket and $ The city council passes a law prohibiting you from charging different prices to different customers. for all tickets, resulting in $ for a child's in profit. Group of People Better Off Worse Off Unchanged Adults Children You, the Producer Indicate whether each of the following groups of people is better off, worse off, or the same because of the law prohibiting price discrimination.

6. Problems and Applications Q6 You live in a town with 300 adults and 200 children, and you are thinking about putting on a play to entertain your neighbors and make some money. A play has a fixed cost of $1,000, but selling an extra ticket has zero marginal cost. Here are the demand schedules for your two types of customers: Price (Dollars) 10 9 8 76543NTO 2 0 Adults (Tickets) 0 50 100 150 200 250 300 300 300 300 300 Children (Tickets) 0 0 0 0 0 50 100 150 200 200 200 To maximize profit, you would charge $ ticket. Total profit in this case would be $ Now you set a price of $ for an adult's ticket and $ The city council passes a law prohibiting you from charging different prices to different customers. for all tickets, resulting in $ for a child's in profit. Group of People Better Off Worse Off Unchanged Adults Children You, the Producer Indicate whether each of the following groups of people is better off, worse off, or the same because of the law prohibiting price discrimination.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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