Use this information to answer the next six questions. The following table shows a community's demand for movie tickets. Assume that only two firms (Showtime Theater and Big Screen Cinema) sell in this market, that each firm offers the same quality of service and movie selection, and that each firm's marginal cost is constant and equal to zero due to excess capacity. Number of Ticket Price (P). Tickets Sold (Q) Total Revenue (TR) $10 $0 $9 50 $450 $8 100 $800 $7 150 $1,050 $6 200 $1,200 $5 250 $1,250 $4 300 $1,200 $3 350 $1,050 $2 400 $800 $1 450 $450 $0 500 $0 Listed below are four different collusive agreements that Showtime Theater and Big Screen Cinema are considering. Assuming both firms will abide by the terms, which collusive agreement(s) would maximize total profit in the market? 1. Showtime Theater supplies 100 tickets and Big Screen Cinema supplies 50 tickets. II. Showtime Theater supplies 75 tickets and Big Screen Cinema supplies 125 tickets. III. Showtime Theater supplies 125 tickets and Big Screen Cinema supplies 125 tickets. IV. Showtime Theater supplies 50 tickets and Big Screen Cinema supplies 200 tickets. O Agreement I only O Agreements I and Il only IvuTver UI Ticket Price (P) Tickets Sold (Q) Total Revenue (TR) $10 $0 $9 50 $450 $8 100 $800 $7 150 $1,050 $6 200 $1,200 $5 250 $1,250 $4 $1,200 $1,050 300 $3 350 $2 400 $800 $1 450 $450 $0 500 $0 Listed below are four different collusive agreements that Showtime Theater and Big Screen Cinema are considering. Assuming both firms will abide by the terms, which collusive agreement(s) would maximize total profit in the market? 1. Showtime Theater supplies 100 tickets and Big Screen Cinema supplies 50 tickets. IL Showtime Theater supplies 75 tickets and Big Screen Cinema supplies 125 tickets. III. Showtime Theater supplies 125 tickets and Big Screen Cinema supplies 125 tickets. IV. Showtime Theater supplies 50 tickets and Big Screen Cinema supplies 200 tickets. O Agreement I only O Agreements l and II only O Agreements Il and III only O Agreement Il only O Agreements Il and IV only
Use this information to answer the next six questions. The following table shows a community's demand for movie tickets. Assume that only two firms (Showtime Theater and Big Screen Cinema) sell in this market, that each firm offers the same quality of service and movie selection, and that each firm's marginal cost is constant and equal to zero due to excess capacity. Number of Ticket Price (P). Tickets Sold (Q) Total Revenue (TR) $10 $0 $9 50 $450 $8 100 $800 $7 150 $1,050 $6 200 $1,200 $5 250 $1,250 $4 300 $1,200 $3 350 $1,050 $2 400 $800 $1 450 $450 $0 500 $0 Listed below are four different collusive agreements that Showtime Theater and Big Screen Cinema are considering. Assuming both firms will abide by the terms, which collusive agreement(s) would maximize total profit in the market? 1. Showtime Theater supplies 100 tickets and Big Screen Cinema supplies 50 tickets. II. Showtime Theater supplies 75 tickets and Big Screen Cinema supplies 125 tickets. III. Showtime Theater supplies 125 tickets and Big Screen Cinema supplies 125 tickets. IV. Showtime Theater supplies 50 tickets and Big Screen Cinema supplies 200 tickets. O Agreement I only O Agreements I and Il only IvuTver UI Ticket Price (P) Tickets Sold (Q) Total Revenue (TR) $10 $0 $9 50 $450 $8 100 $800 $7 150 $1,050 $6 200 $1,200 $5 250 $1,250 $4 $1,200 $1,050 300 $3 350 $2 400 $800 $1 450 $450 $0 500 $0 Listed below are four different collusive agreements that Showtime Theater and Big Screen Cinema are considering. Assuming both firms will abide by the terms, which collusive agreement(s) would maximize total profit in the market? 1. Showtime Theater supplies 100 tickets and Big Screen Cinema supplies 50 tickets. IL Showtime Theater supplies 75 tickets and Big Screen Cinema supplies 125 tickets. III. Showtime Theater supplies 125 tickets and Big Screen Cinema supplies 125 tickets. IV. Showtime Theater supplies 50 tickets and Big Screen Cinema supplies 200 tickets. O Agreement I only O Agreements l and II only O Agreements Il and III only O Agreement Il only O Agreements Il and IV only
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
ASAP
Transcribed Image Text:Use this information to answer the next six questions.
The following table shows a community's demand for movie tickets. Assume that only two firms (Showtime
Theater and Big Screen Cinema) sell in this market, that each firm offers the same quality of service and movie
selection, and that each firm's marginal cost is constant and equal to zero due to excess capacity.
Number of
Ticket Price (P).
Tickets Sold (Q)
Total Revenue (TR)
$10
$0
$9
50
$450
$8
100
$800
$7
150
$1,050
$6
200
$1,200
$5
250
$1,250
$4
300
$1,200
$3
350
$1,050
$2
400
$800
$1
450
$450
$0
500
$0
Listed below are four different collusive agreements that Showtime Theater and Big Screen Cinema are
considering. Assuming both firms will abide by the terms, which collusive agreement(s) would maximize
total profit in the market?
1. Showtime Theater supplies 100 tickets and Big Screen Cinema supplies 50 tickets.
II. Showtime Theater supplies 75 tickets and Big Screen Cinema supplies 125 tickets.
III. Showtime Theater supplies 125 tickets and Big Screen Cinema supplies 125 tickets.
IV. Showtime Theater supplies 50 tickets and Big Screen Cinema supplies 200 tickets.
O Agreement I only
O Agreements I and Il only
IvuTver UI
Ticket Price (P)
Tickets Sold (Q)
Total Revenue (TR)
$10
$0
$9
50
$450
$8
100
$800
$7
150
$1,050
$6
200
$1,200
$5
250
$1,250
$4
$1,200
$1,050
300
$3
350
$2
400
$800
$1
450
$450
$0
500
$0
Listed below are four different collusive agreements that Showtime Theater and Big Screen Cinema are
considering. Assuming both firms will abide by the terms, which collusive agreement(s) would maximize
total profit in the market?
1. Showtime Theater supplies 100 tickets and Big Screen Cinema supplies 50 tickets.
IL Showtime Theater supplies 75 tickets and Big Screen Cinema supplies 125 tickets.
III. Showtime Theater supplies 125 tickets and Big Screen Cinema supplies 125 tickets.
IV. Showtime Theater supplies 50 tickets and Big Screen Cinema supplies 200 tickets.
O Agreement I only
O Agreements l and II only
O Agreements Il and III only
O Agreement Il only
O Agreements Il and IV only
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education