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3. (10 marks in total) Assume that a professional sports team maximizes profits but realizes that
there are different demands for games depending on the day of the week. Suppose the inverse
demand is given by P=1672Q for Sundays and it is P=1201.5Q for Tuesdays. Furthermore,
assume that the marginal cost of selling a ticket is constant per ticket and equal to 3 . Assume
there a no capacity constraints. a) (6 marks) Draw a single graph as close to scale as you can and
clearly label all relevant lines and axes. b) (2 marks) What discount will the team give to
Tuesday ticket purchasers to maximize their profits? c) ( 2 marks) What will attendance be on
Tuesdays versus Sundays?

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3. (10 marks in total) Assume that a professional sports team maximiz.pdf

  • 1. 3. (10 marks in total) Assume that a professional sports team maximizes profits but realizes that there are different demands for games depending on the day of the week. Suppose the inverse demand is given by P=1672Q for Sundays and it is P=1201.5Q for Tuesdays. Furthermore, assume that the marginal cost of selling a ticket is constant per ticket and equal to 3 . Assume there a no capacity constraints. a) (6 marks) Draw a single graph as close to scale as you can and clearly label all relevant lines and axes. b) (2 marks) What discount will the team give to Tuesday ticket purchasers to maximize their profits? c) ( 2 marks) What will attendance be on Tuesdays versus Sundays?