Question: An amusement park, whose customer set is made up of two markets, adults and adults and children, has developed demand schedules as follows:

Price ($) Adults Children

5 15 20

6 14 18

7 13 16

8 12 14

9 11 12

10 10 10

11 9 8

12 8 6

13 7 4

14 6 2

The marginal operating cost of each unit of quantity is $5. (Hint: because marg. cost is a constant, so is avg. variable cost. Ignore fixed cost.) The owners of the amusement park want to maximize profits.

Calculate the price, quantity, and profit if:

The amusement park charges a different price in each market.