Homework Answers
a) Profit maximising output occurs at MR = MC
In this case it is Q= 25 Meals and P= $12 ( Here MR=MC)
b) Profit at Q = 25 Meals and P = $ 12 = Profit = TR - TC= 25 x 12 - 6 x 25 = $150 = Profit
c) At p =$12 , 0 meals will be bought by senior citizen consumers
d) $9 and 15 meals: for price discrimination: at this quantity the firm will maximise profit in the case of SENIOR CITIZEN CONSUMER
e) In case of Senior Citizen Consumer: P = $9, Q= 15 MEALS, Profit= TR - TC = 9 x 15 - 6 x 15 = $ 45
In case of average consumers: P = $12, Q= 25, P= $ 150
Total profit = 150 + 45= $ 195
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