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Marginal revenue for each group

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Suppose you own some nice apartments that you've recently decided to rent out on Airbnb. You believe that the demand for your apartments is different for college students than non-college students:

Group 1 (non-college students): Q_1^D=400-P_1

Group 2 (college students): Q_2^D=600-2P_2

Here Q_i^DQiD? is the quantity demand for Group ii When it faces price P_iPi?. This implies that the marginal revenue for each group is:

MR_1=400-2Q_1^D?

MR_2=300-Q_2^D

?Finally, suppose the marginal cost differs for each group (because college students tend to be more messy and like to party). Specifically, you estimate that the marginal cost for non-college students is $60 (MC_1=$60) and the marginal cost for college students is $80 (MC_2=$80)

1) If you price discriminate, the profit maximizing price for non-college students (Group 1) is $? and the profit maximizing price for college students (Group 2) is $?

Reference no: EM133123990

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