The city of A is considering whether to build a new public swimming pool. The pool would have a capacity of 800 swimmers per day and the proposed admission fee is $6 per person per day. The estimated cost, averaged over the expected lifetime of the pool, is $4 per person per day.
The city has hired you to assess the project. Fortunately, the nearby town of B (a town similar to A) already has a pool and you have the results of a study conducted by B town that shows how quantity demanded varies with the admission price. That information is listed below.
Admissions Price Number of Swimmers per day
2 1400
4 1100
6 800
8 500
10 200
A. Draw a graph that shows the demand schedule, the proposed price and the anticipated quantity demanded.
B. find out the anticipated total revenue, total cost, and profit.
C. find out the anticipated consumer surplus