A Movie Monopolist Sells to Students and Adults

question 16

Multiple Choice

A movie monopolist sells to students and adults.The demand function for students is and the demand function for adults is The marginal cost is $2 per ticket.Suppose the movie theater cannot price discriminate.What is the monopolist's profit from both students and adults?

• A) $2500
• B) $4950
• C) $2450
• D) $50

---

Definitions:

Inflation

The rate at which the general level of prices for goods and services is rising, leading to a decrease in the purchasing power of money.

Grease the Wheels

An expression used to describe actions that facilitate or ease the progress of a process, activity, or operation, often implying making things run more smoothly and efficiently.

Political Business Cycle Theory

A theory suggesting that elected officials may manipulate economic policies to produce favorable economic conditions ahead of elections to increase their chances of reelection.

Discount Rate

The interest rate on the loans that the Fed makes to banks.