Jack’s surf shop sells surfboards to customers from Santa Barbara and Goleta. Santa Barbara customers have demand given by P(q) = 20−q/3 and Goleta customers have demand P(q) = 40−q. What price does Jack have to charge to sell a total of q = 60?
Jack’s surf shop sells surfboards to customers from Santa Barbara and Goleta. Santa Barbara customers have...
Mary owns the only ballet school in Santa Barbara. There is demand from college students and long term residents. The inverse demand for private lessons from the students is p(q) = 50−q, and the demand from the residents is p(q) = 170−3q. Assume that Mary charges 20 dollars per class, but only teaches people who have become members of her school. There is a set membership fee, but she has discounts for students. (Continued from previous question) Assume a new...
a monopolistic firm sells it product to two types of customers , business customers and other customers . its total cost are given by Tc=20+2Q , where Q denotes total output . the total demand of business customers is given by Q^3 =14-P .The total demand of other customers is given by Q^T=5-0.5P . Assuming that third degree price discrimination between the two groups is possible. Calculate the prices that the firm will charge each group , the amount it...
Mary owns the only ballet school in Santa Barbara. There is demand from college students and long term residents. The inverse demand for private lessons from the students is p(q) = 50-q, and the demand from the residents is p 170- 3q. Assume that Mary charges 20 dollars per class, but only teaches people who have become members of her school. There is a set membership fee, but she has discounts for students. How much discount should she have for...
Suppose that you own a bakery that sells cookies. Each cookie has a marginal and average cost of $1, there are no fixed costs. You notice that all of your customers have the same demand curve for cookies given by p=5 - Q Compute the optimal single price to charge for cookies. How many cookies does each customer purchase? How much profit does your bakery make per customer? What is the consumer surplus at the price and quantity you found...
Exercise 2: Please help! A monopolist manufacturer sells to competitive retailers. The competitive retailers currently provide no services for the manufacturer’s good. Suppose the final consumer demand for the good at the retailer level is P = 100–Q and the costs for the manufacturer of producing the good are represented by MC = AC = 20. Currently, the manufacturer sell the good to the retailer at w=60. 1. Calculate the profit of the retailers and of the manufacturer The manufacturer...
(8 points) A coffee shop sells bags of roasted coffee beans to customers to make into coffee at home. The demand for these bags is quite predictable (and can be treated as deterministic for our purposes). The shop sells 3,500 bags of coffee beans per year. Each time the shop places an order for these bags with its coffee supplier, it incurs an administrative cost of $15, independent of the quantity ordered. The company values each bag at $12.50 (this...
Second Degree Price Discrimination Q2. HP sells printers to two types of customers with different demands for printer speed. HIGH-type 40 2q where q is the speed (quality) of the printer and users have inverse demand for speed of P(g) 30 3q. There are two LOW-type LOW-type users have inverse demand for speed of P(q) users for every HIGH-type user. The marginal cost of a printer of any speed is zero. HP plans to sell two types type of speed...
1. Katherine advertises to sell cookies for $4 a dozen. She sells 50 dozen, and decides that she can charge more. She raises the price to $6 a dozen and sells 30 dozen. What is the elasticity of demand? Assuming that the elasticity of demand is constant, how many would she sell if the price were $8 a box? 2. Acmes marginal cost for producing the 100th unit of good Y is $20. Acme can sell good Y for $25....
Suppose a company has a monopoly on yogurt, and sells it to two types of consumers. The company is unable to identify which type of consumer is which. One type of consumers really enjoys yogurt, and has an individual demand for servings of yogurt of Qh= 20 − 2P. The other type likes yogurt less, and has an individual demand for servings of Ql=16−2P. The marginal cost of a serving of yogurt is 4. The company decides to adopt a...
You work for butcher shop in the Middleofnowhere Texas. Your boss wants to raise the price of beef from $5 a pound to $6 a pound, but isn’t sure of the effect this will have on the amount of beef the butcher shop sells. The butcher shop currently sells 800 pounds in a week. Since you have an economic background, your boss tasks you with finding out the new quantity demanded of beef given the price increase. What is the...