Bale Student Question Graded Assignment | Due Monday 12.11.17 at 0145 AM Attempt

Question

Bale Student Question Graded Assignment | Due Monday 12.11.17 at 0145 AM Attempts:10Keep the Highest: 1/4 7. Price discriminating monopolist Rajv owns a plot of land in the desart that in't worth much. One day, a giant meteorite Falls on his proprty, making a large crater. The ecent attracts scientists and tourists, and Rajiv decides to sell nontransferable admission tickets to the metoor crater to both types of visitors: scientists (Market A) and tounots (Market 8). The foliowing orachs show daily demand (D) ourves and marginal revenue (MR) curves for the two marioets. Rajiv's marginal cost of providing admission tickets is zero Market B Market A MR QUANTITY (Admission ticks QUANTITY (Adrsission tickets) Suppose that at first, Rajiv charpes the same price of $8 per admission in both markets so that the total number of admissions demanded a

Explanation / Answer

If Rajiv charges the same price of $8 in both the markets, the total number of admission demanded will be 8. (6 in first market 2 in the second market).

$5 in the first market, and $3 in the second market. At these prices, he will sell a total quantity of 16 tickets (10 in the first market, 6 in the second market).

Pricing policy

Non-discriminatory price will give him a total revenue of $64.

Price discrimination will give him a revenue $50 from the first market and $18 form the second market. A total of $68 from both markets.

Rajiv charges a lower price in the market with "Low" price elasticity of demand.

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