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An Airline Has Exclusive Landing Rights at the Local Airport

Question 31

Multiple Choice

An airline has exclusive landing rights at the local airport.The airline flies one flight per day to New York with a plane that has a seating capacity of 100.The cost of flying the plane per day is $4,000 + 10q, where q is the number of passengers.The number of flights to New York demanded is q = 165 - .5p.If the airline maximizes its monopoly profits, the difference between the marginal cost of flying an extra passenger and the amount the marginal passenger is willing to pay to fly to New York is


A) $10.
B) $100.
C) $140.
D) $160.
E) None of the above.

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