Calculate the profit-maximizing price

Assignment Help Microeconomics

Reference no: EM133203640

Assignment:

The Charlotte Squash Club asked you to devise a profit maximizing pricing strategy. In doing so, you can rely on data provided by another area consultant. The data suggest that demand conditions for court time are as follows:

P=105 - 2Q

Where P is the price of one hour of court time and Q is the number of hours of court time an individual player would purchase during the squash season. Charlotte Squash Club has been operating for several decades. Feeling that the club recovered all overhead long ago, the firm considers fixed cost to be zero. Marginal cost is constant $5 per hour.

1. Calculate the profit-maximizing price, output and profit level assuming a per unit charge for each hour of squash played.

2. Calculate the profit-maximizing price, output and profit level assuming that the firm moves to a two-part pricing approach charging a fixed fee plus a price per hour.

3. Which strategy should the firm employ? Explain.

Reference no: EM133203640

Questions Cloud

Long from arguments require organization : Long from arguments require organization. Without organizing before you write, your peppers can become rambling messed that are hard to follow.

Why was the disney shanghai park controversial : Why was the Disney Shanghai park controversial? What were the risks and benefits of the project. As a conclusion, reflect on your overall thoughts on this case

Find research paper on an approved topic : Compose enough pages research paper on an approved topic in your prospective field( Nursing ), using a minimum of six sources, four must be academic sources.

Recommendation for a specific bilingual model : Your friend, Lydia, has a child, Andres, who will be starting kindergarten in a few months. Recognizing your growing expertise in bilingual education, Lydia see

Calculate the profit-maximizing price : Calculate the profit-maximizing price, output and profit level assuming a per unit charge for each hour of squash played.

Discuss how netflix can compete in the saturated market : Take the perspective of streaming pioneer Netflix. Critically discuss how Netflix can compete in this saturated market.

What is the national eating disorder : After reading the article, please answer the following questions? What is the national eating disorder that Pollan is talking about?

Explain the large impact on modern society : What is one piece of technology or one invention that has had a large impact on modern society? Explain the technology or invention thoroughly

How can side conversations impact your chosen industry : For this discussion, review the Harvard Business Review. How can side conversations impact your chosen industry in both positive and negative ways

User Account

All Pages