As a manager of a chain of movie theaters that are monopolies in their respective markets, you have noticed much higher demand on weekends than during the week. You therefore conducted a study that has revealed two different demand curves at your movie theaters. On weekends, the inverse demand function isP= 20 - 0.001Q; on weekdays, it isP= 15 - 0.002Q.You acquire legal rights from movie producers to show their films at a cost of $25,000 per movie, plus a $2.50 "royalty" for each moviegoer entering your theaters (the average moviegoer in your market watches a movie only once).

What type of pricing strategy should you consider in this case?

A) First degree price discrimination

B) Third degree price discrimination

C) Block pricing

D) Second degree price discrimination

What price should you charge on weekends?

Instruction:Enter your response rounded to two decimal places.

$_______?

What price should you charge on weekdays?

Instruction:Enter your response rounded to two decimal places.

$_____?