Table 7.2
-Table 7.2 contains price, demand, and cost data for the Capri Theater, the only first-run movie theater in a small town. What is its total profit under the student discount policy?
A) $450
B) $550
C) $600
D) $650

Question

Table 7.2
-Table 7.2 contains price, demand, and cost data for the Capri Theater, the only first-run movie theater in a small town. What is its total profit under the student discount policy?
A) $450 
B) $550 
C) $600 
D) $650

Quizplus · Accepted Answer

Under the student discount policy, the ticket price is $6.50 and the demand is 115 tickets. The total revenue will be $747.50 (6.5 x 115 = 747.5). The total cost will be $197 (fixed cost of $150 + 115 x $0.50). Thus, the total profit will be $550 (747.5 - 197 = $550). Therefore, the best choice is B.

Table 7.2 -Table 7.2 Contains Price, Demand, and Cost Data for the for the Capri