Question
Tina's Bar is a popular drinking establishment. Tina charges a fixed nightly cover fee to each customer to get in the door, and then the
Tina's Bar is a popular drinking establishment. Tina charges a fixed nightly cover fee to each customer to get in the door, and then the same price p for every drink. The marginal cost of making a drink is $10. Suppose she gets 40 customers per night and they all have the same nightly demand for drinks: q = 6 - 0.2p.
(a) What is Tina's profit-maximizing per-customer cover charge?
(b) What price p will she charge per drink?
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Power And Plenty Trade, War, And The World Economy In The Second Millennium
Authors: R Findlay, Ronald Findlay
1st Edition
0691143277, 9780691143279
