Suppose you run a cruise ship and that the estimated demand for your rooms on the ship is Q_d=1000-4P whereQd and P represent the quantity demanded and price of a room on the ship per night, respectively. This implies that marginal revenue is given bydMR=25021Qd. Suppose further that the cost you incur from having someone stay in a room is $50 per room, per night.

1)If maximum capacity on the cruise ship is 500, then the profit maximizing price is $? per night?

2)If instead, maximum capacity on the cruise ship is 300, then the profit maximizing price is $?

3)More generally, for products like cruise ships, parking lots, hotels, etc., costs of building capacity are mostly fixed or sunk and firms in these industries typically face capacity constraints. Therefore it is?