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Question: There is a movie theater with marginal cost curve MC = 1. The theater is facing two different dem...

Show transcribed image text There is a movie theater with marginal cost curve MC = 1. The theater is facing two different demand functions. Q_1 = 7 – P and Q_2 = 2.5 – 0.5P. Imagine the movie theater engages in multimarket price discrimination (third degree price discrimination). a) What is the profit maximizing price and quanity for consumer 1? i) Q_1 = ______. P_1 = ______ b) What is the producer surplus from consumer 1? i) PS_1 = ______ c) What is the profit maximizing price and quantity for consumer 2? i) Q_2 = ______, P_2 = ______ d) What is the total producer surplus? i) PS = ______

There is a movie theater with marginal cost curve MC = 1. The theater is facing two different demand functions. Q_1 = 7 – P and Q_2 = 2.5 – 0.5P. Imagine the movie theater engages in multimarket price discrimination (third degree price discrimination). a) What is the profit maximizing price and quanity for consumer 1? i) Q_1 = ______. P_1 = ______ b) What is the producer surplus from consumer 1? i) PS_1 = ______ c) What is the profit maximizing price and quantity for consumer 2? i) Q_2 = ______, P_2 = ______ d) What is the total producer surplus? i) PS = ______