ESSENTIALS OF ECONOMICS
11th Edition
ISBN: 9781260225334
Author: SCHILLER
Publisher: RENT MCG
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Chapter 3, Problem 6QFD
To determine
The consequences of setting the
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- Miron Floren, of Lawrence Welk Show fame, now tours the country performing at accordion concerts. A careful analysis of demand for tickets to Mr. Floren’s concerts reveals a strange segmentation in the market. Demand for tickets by senior citizens is described by Qo = 500P^–3/2 , while demand by those under 65 years old is Qy = 50P^–4. If the marginal cost of a ticket is £3, how should tickets to Mr. Floren’s concerts be priced to maximize profits? A. £3 for senior citizens and £8 for those younger B. £6 for senior citizens and £12 for those younger C. £9 for senior citizens and £4 for those younger D. £4.71 for all tickets E. £12 for senior citizens and £4.50 for those youngerarrow_forwardDemand for Corn Flakes is: P = 10 - Q. Supply of Kellogg's Corn Flakes is: P = 2 + Q. Now a generic company enters the market, selling generic Corn Flakes for $3. Assume consumers are indifferent between generic and Kellogg's Corn Flakes. When the generic corn flakes enter the market, Kellogg's will sell how many less boxes of their own cereal? Enter as an absolute value (NOT a negative number).arrow_forwardWhat is most likely the reason?arrow_forward
- For theater tickets, the demand curve for students is QS=100−4PQS=100−4P and for the general public is QGP=200−4PQGP=200−4P. Graph demand for students, the general public, and the market. (Hint: Don’t forget the kink.) What is the equation(s) for market demand?arrow_forwardAbove is the demand schedule for tickets to a Carnegie Hall performance of the Grateful Dead. Carnegie Hall seats 1,800 people. What is the equilibrium price and quantity for a concert of the Grateful Dead at Carnegie Hall? If tickets were sold for $18, what would happen (be specific)?arrow_forwardDemand for Corn Flakes is: P = 14 - Q. Supply of Kellogg's Corn Flakes is: P = 2 + Q. Now a generic company enters the market, selling generic Corn Flakes for $4. Assume consumers are indifferent between generic and Kellogg's Corn Flakes. When the generic corn flakes enter the market, Kellogg's will sell how many less boxes of their own cereal?arrow_forward
- The average ticket price for a concert at the opera house was $30. The average attendance was 5000. When the ticket price was raised to $33, attendance declined to an average of 4700 persons por performance. What should the ticket price be to maximize revenue for the opera house? (Assume a linear demand curve.) To maximize revenue, the price should be $ por ticket. (Type an integer or decimal rounded to two decimal places as needed. Simplify your answer.)arrow_forwardWhat effect will each of the following have on the supply of auto tires? The granting of a 50-cent-per-unit subsidy for each auto tire produced.arrow_forwardS(x) = 0.50x + 50 D(x) = -0.50x + 80 Is there a market surplus or shortage when the price is $800?arrow_forward
- If the demand for airline traveling increases,arrow_forwardConsider the supplier of a product that is an inferior good. For instance, an aluminum supplier for a canned goods producer. During a recession during which average incomes fall, which of the following best describes what would happen to the profit-maximizing price of the supplier? a. The supplier’s profit-maximizing price would decrease due to an increase in demand. b. The supplier’s profit-maximizing price would increase due to an increase in demand. c. The supplier’s profit-maximizing price would decrease due to a reduction in demand. d. The supplier’s profit-maximizing price would increase due to a reduction in demand.arrow_forwardWhy might a movie theater charge a lower admission price for the first show on weekday afternoons than they do for a weeknight or weekend show?a) Demand is lower for the weekday afternoon showing of the movie than for the weeknight or weekend showing.b) The supply of seats in the theater is greater on a weekday afternoon and the demand to see the movie is lower for the weekday afternoon showing.c) Theaters like to show with the lower prices that they want every income group to attend their movies.d) The supply of seats in the theater is greater on a weekday afternoon.arrow_forward
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