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-25-0.0010, on weekdays, it is P-20-0.002Q You acquire legal rights from movie producers to show their films at a cost of $30,000 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? Second degree price discrimination OFirst degree price discrimination Third degree price discrimination Block pricing
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-25-0.0010, on weekdays, it is P-20-0.002Q You acquire legal rights from movie producers to show their films at a cost of $30,000 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? Second degree price discrimination OFirst degree price discrimination Third degree price discrimination Block pricing
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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