The movie distributor charges a movie theatre 8 per ticket, Ask an Expert

Economics

The movie distributor charges a movie theatre $ 8 per ticket to watch a movie. Suppose the theatre can seat a maximum of 1,900 people. The demand for the movie is different for the afternoon showing and for the evening showing. Based on the demand function :

P = 80 – Q/40 for the evening showing,

P = 40 – Q/40 for the afternoon showing and

The marginal-revenue function for the

evening is MR = 80 – Q/20

afternoon is MR = 40 – Q/20

Calculate the profit-maximizing price in the evening ____________ and the afternoon; ____________ also calculate how many tickets will be sold for each show.

evening ____________

afternoon;____________

Suppose that the movie distributor now charges a flat fee of 2,600 to show the movie regardless of the number of tickets sold. Will the movie theatre owner prefer this arrangement? _________

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M92197475

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