Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please answer asap Joe has just moved to a small town with only one golf course, the Northlands Golf Club. His inverse demand function is

please answer asap

image text in transcribed
Joe has just moved to a small town with only one golf course, the Northlands Golf Club. His inverse demand function is p = 160 -2q, where q is the number of rounds of golf that he plays per year. The manager of the Northlands Club negotiates separately with each person who joins the club and can therefore charge individual prices. This manager has a good idea of what Joe's demand curve is and offers Joe a special deal, where Joe pays an annual membership fee and can play as many rounds as he wants at $20, which is the marginal cost his round imposes on the Club. What membership fee would maximize profit for the Club? The manager could have charged Joe a single price per round. How much extra profit does the Club earn by using two-part pricing? The profit-maximizing membership fee (F) is $ . (Enter your response as a whole number.) The Club's extra profit (above what its profit would have been from charging a single per-round price) is $ . (Enter your response as a whole number.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

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

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

Quality Of The Environment An Economic Approach To Some Problems In Using Land, Water, And Air

Authors: Orris C Herfindahl, Allen V Kneese

1st Edition

1317386663, 9781317386667

More Books

Students also viewed these Economics questions

Question

=+c) Compare your forecast to the actual value (by computing APE).

Answered: 1 week ago

Question

3. What values would you say are your core values?

Answered: 1 week ago