How to find profit maximization in a question where there are 12 demanders with Buyer Values of $26, 18 demanders with Buyer Values of $16, and 6 demanders with Buyer Values of $11 with cost of five dollars?

How to find profit maximization in a question where there are 12 demanders with Buyer Values of $26, 18 demanders with Buyer Values of $16, and 6 demanders with Buyer Values of $11 with cost of five dollars?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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An international airline in Ghana ,Emirates ,estimates that the price elasticity of demand for business who travellers weekdays is -3,while that for vacation travellers who travel on weekends is -5 .if the aim of the airline is to maximise profit what pricing strategy will you recommend to the airline and why?
Suppose there are two types of cable TV viewers. The first type places a high value on sports channels (e.g., ESPN, Fox Sports, and the Golf Channel) and a low value on all other channels. The second type places a high value on music channels (e.g., VH1, MTV3, and CMT) and a low value on all other channels. In this case, we would expect cable operators to: use fixed-cost pricing. use "à la carte" pricing. sell sports and music channels in one bundle to both types of viewers. sell only sports channels to the first type of viewers and sell only music channels to the second type of viewers.
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Noticing that profits on college text books are very high, the Beast Book Store (BBS), with the help of a venture capitalist, has gone into text book publishing. In its current production range its average total cost is approximately equal to its marginal cost which it estimates to be about $25. It has estimated that price elasticity of demand for its books at current price levels to be about -1.5. The manager of BBS uses mark-up pricing to price the books that it sells using a 150% mark-up (even with this mark-up BBS can still underprice most other book publishers). Assuming that BBS wants to maximize short-term profits on its book sales and initially enjoys a monopoly in the local college textbook production market, is this a good pricing procedure? Harvard and other local colleges soon start publishing companies of their own increasing competition and causing the price elasticity of demand for BBS books to increase to -2.0. Assuming that BBS’s demand curve that generates this -2.0…
Your firm is considering entering a new territory. From market research, you have obtained the following demand function that explains how your price (P in dollars) and advertising (A in thousands of dollars) choices influence the quantity demanded (Q in thousands of units). Q = 20 - 6P + 2A To enter the new market you plan on running $10,000 worth of ads. The marginal cost of producing your product is $1 per unit. 3a) What is your profit maximizing price, quantity sold, and profit?