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3.- (From problem 5.3 in the textbook) A nightclub manager realizes that demand for drinks is more elastic among students and is trying to determine
3.- (From problem 5.3 in the textbook) A nightclub manager realizes that demand for drinks is more elastic among students and is trying to determine the optimal pricing schedule. Specifically, he estimates the following average demands: - Student: gs =18 5p + Non-student: g=10-2p The two types visit the nightclub, but in a typical night there are twice as many students as non- students. Assume that drinks cost the nightclub $2 each. (a) If the market cannot be segmented, what is the uniform monopoly price? (b) If the nightclub can charge according to whether the customer is a student or not but is limited to linear pricing, what price (per drink) will the manager set for each group? (c) If the nightclub cannot charge according to whether the customer is a student or not, but can set a (common) cover charge and a (common) price per drink (which we assume equal to $2), what two-part tariff will the manager choose? (d) If the nightclub can set a separate cover charge and price per drink for each group, what two- part pricing schemes will the manager choose
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