Question
Inverse demand for season tickets at the University of Arkansas football games is P = 100 - 0.25Q,, where Q is quantity of tickets (in
Inverse demand for season tickets at the University of Arkansas football games is P = 100 - 0.25Q,, where Q is quantity of tickets (in lO0's.) The marginal cost of supplying tickets is constant at MC= 10.
a.Find the profit maximize P and Q if the university acts like a single-price non discriminating monopolist.
b.The university now requires all season ticket buyers to contribute into the "VIP Athletic Club" for the right to purchase a season ticket (two-part pricing) plus the price of a season ticket that you found in part a above. What is the maximum amount that it can charge for VIP Club? Compare the profits to part (a).
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