Suppose in a small town called Utopia live 200 children and 300 adults. The only entertainment in the town is a theatre. The theatre has a fixed cost of 2000 dollars for preparing each play. However, once the play is ready, then selling an additional ticket has no cost at all. Demand for adult citizens and children are given in the following table What if the municipal government of Utopia decides to prohibit price discrimination, what will be the price charged by the theatre company? How much profit will it make.

In this case, profit would be maximizing at point where revenue is maximum and outcome also same as…

Answered: if the municipal government of Utopia…

Business

Economics

if the municipal government of Utopia decides to prohibit price discrimination

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter9: Monopoly

Section: Chapter Questions

Problem 8SQ

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Suppose in a small town called Utopia live 200 children and 300 adults. The only entertainment in the town is a theatre. The theatre has a fixed cost of 2000 dollars for preparing each play. However, once the play is ready, then selling an additional ticket has no cost at all. Demand for adult citizens and children are given in the following table What price would this theatre company charge for an adult ticket and for a child’s ticket? How much will it make?
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