HBO has MC=0 of giving someone access to their platform. Suppose there are two possible markets of people in the US, Movie Buffs and Movie Casuals. There are 50 of each. The demand of Movie Buffs for HBO is

() = 100 2 25 And () = 50 < 25

The demand of Movie Casuals for HBO is () = 50 2

a. Draw the demand curve for movie buffs. (2pts) b. Draw the demand curve for movie casuals. (2pts)

c. Calculate the aggregate market demand of both Movie Buffs and Movie Casuals for HBO. (1pt) D(P)=

d. Draw the aggregate demand curve for Movie Buffs and Movie Casuals. (2pts)

e. Suppose HBO faces the market demand curve you calculated in (c). Calculate HBO's profit maximizing quantity and price, and . (2pt)

f. Calculate the profits of the monopolist (don't worry about fixed costs). (1pt) h. Suppose HBO acquires the service of CMU Analytics. Calculate HBO's profit maximizing quantity and price in each market, , , and . (4pt)