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You own a private parking lot near USF with a capacity of 600 cars. The demand for parking at this lot is estimated to be Q = 1000 - 2p, where Q is the number of customers with monthly parking passes

You own a private parking lot near USF with a capacity of 600 cars. The demand for parking at this lot is estimated to be Q = 1000 - 2p, where Q is the number of customers with monthly parking passes and p is the monthly parking fee per car. (a) (2 points) Derive your marginal revenue schedule. (b) (4 points) What price generates the greatest profit? Your fixed costs of operating the parking lot, such as the monthly lease paid to the landlord and the cost of hiring an attendant are $25,000 per month. In addition, your insurance company charges you $20 per car per month for liability coverage, and the City charges you $30 per car per month as part of its policy to discourage the use of private automobiles. (c) (6 points) With the new information, should you stay in the business? If so, what is your profit-maximizing price?

1. (12 points) You own a private parking lot near USF with a capacity of 600 cars. The demand for parking at this lot is esti

May 09 2021 View more View Less

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