In Questions 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.
-Assuming both daytime and nighttime markets are served, the optimal fixed access charge (A*) is
A) A* = $1,472
B) A* = $2,178
C) A* = $3,872
D) A* = $4,356
E) A* = $7,744

Question

In Questions  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. 
-Assuming both daytime and nighttime markets are served, the optimal fixed access charge (A*) is
A) A* = $1,472 
B) A* = $2,178 
C) A* = $3,872 
D) A* = $4,356 
E) A* = $7,744

Quizplus · Accepted Answer

The Answer is B

In Questions a Firm Sells Its Product to Two