A Firm Sells Its Product to Two Groups of Buyers

question 35

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. Should the firm bother to sell output to the nighttime market?

• A)Yes,because only $77,200 of profit is earned by serving only the daytime buyers.
• B)Yes,because only $137,200 of profit is earned by serving only the daytime buyers.
• C)No,because $240,000 of profit is earned by serving only the daytime buyers.
• D)No,because $300,000 of profit is earned by serving only the daytime buyers.

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Definitions:

Marx's Conception

Karl Marx's theory on societal development which emphasizes the role of class struggle, the economic base of society, and the importance of material conditions.

Foucault's Conception

Refers to the philosophical and theoretical frameworks developed by Michel Foucault, particularly around the relationships between power, knowledge, and social institutions.

Symbolic Tokens

Symbols or items that represent values, beliefs, or aspects of a culture or society, often used to communicate intangible concepts.

Globalization

The process of interaction and integration among people, companies, and governments worldwide, often driven by international trade and investment and aided by information technology.