A Firm Sells Its Product to Two Groups of Buyers

Question 17
Multiple Choice

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 DD in the figure below.There are 50 nighttime buyers,all of whom have identical demands given by DN 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. img If a firm is selling a product in two markets,A and B,and the marginal revenue in A is $25 and the marginal revenue in B is $20,the firm should A)charge a higher price in A where MR is higher B)charge a lower price in B where MR is lower C)sell more in B and less in A D)sell more in A and less in B E)both a and c