Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

3. Bob, Bill, Ben, and Brad Baxter have just made a documentary movie about their bas- ketball team. They are thinking about making the

3. Bob, Bill, Ben, and Brad Baxter have just made a documentary movie about their bas- ketball team. They are thinking about making the movie available for download on the Internet, and they can act as a single-price monopolist if they choose to. Each time the movie is downloaded, their Internet service provider charges them a fee of $4. The Baxter brothers are arguing about which price to charge customers per down- load. The accompanying table shows the demand schedule for their film. Quantity of downloads demanded Price of download $10 6. 6. 10 15 a. Calculate the total revenue and the marginal revenue per download. b. Bob is proud of the film and wants as many people as possible to download it. Which price would he choose? How many downloads would be sold? c. Bill wants as much total revenuc as possible. Which price would he choose? How many downloads would be sold? d. Ben wants to maximize profit. Which price would he choose? How many down- loads would be sold? e. Brad wants to charge the efficient price. Which price would he choose? How many downloads would be sold?

Step by Step Solution

3.45 Rating (152 Votes )

There are 3 Steps involved in it

Step: 1

a TR P Q MR i TR i TR i1 Q i Q i1 Price Quantity TR MR 10 0 0 8 1 8 8 6 ... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Document Format ( 2 attachments)

PDF file Icon
635f619f3bbec_231898.pdf

180 KBs PDF File

Word file Icon
635f619f3bbec_231898.docx

120 KBs Word File

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Microeconomics

Authors: Paul Krugman, Robin Wells

3rd edition

978-1429283427, 1429283424, 978-1464104213, 1464104212, 978-1429283434

More Books

Students also viewed these Marketing questions

Question

Why do you think this problem has occurred?

Answered: 1 week ago

Question

Calculate the missing values

Answered: 1 week ago