A Firm Sells Its Product to Two Groups of Buyers

question 1

Multiple Choice

A firm sells its product to two groups of buyers: daytime buyers and nighttime buyers.There are 50 daytime buyers,all of whom have identical demands given by D_D in the figure below.There are 50 nighttime buyers,all of whom have identical demands given by D_N in the figure below.The firm's variable costs are constant (SMC = AVC = $12) and its total fixed cost is $250,000.The marketing director must devise a two-part pricing plan that will maximize the firm's profit. How much profit will the firm earn by charging the optimal access charge and optimal access fee (remember that there are 50 daytime and 50 nighttime buyers) ?

• A)$80,600
• B)$90,600
• C)$124,600
• D)$185,600
• E)$215,600

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Definitions:

Ascribed Statuses

Social positions assigned at birth or assumed involuntarily later in life, based on attributes beyond an individual's control.

Social Construction

The theory that many aspects of reality, including social norms and knowledge, are created and maintained through social interactions and agreements among societal members.

Objective Reality

A concept referring to the existence of an external, independent reality that is not influenced by individual feelings, interpretations, or perceptions.

Achieved Statuses

Social positions that are acquired through an individual's own efforts, talents, or choices, as opposed to ascribed statuses, which are inherited.