A movie production company is planning to make its new movie available online so that it can enjoy  monopoly power. Each time the movie is downloaded the production company has to pay 4 taka to the  internet service provider. Now it is deciding what price to charge for each download. The numbers below shows the demand schedule for the company, Price per download dollar  - 10, 8, 6, 4, 2, 0. Quantity of downloads demands 0, 1, 3, 6, 10, 15. a) Calculate the total revenue and marginal revenue per download.   b) To maximize profit what price should be charged and how many downloads would need to be sold?

Managerial Economics: A Problem Solving Approach
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ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
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A movie production company is planning to make its new movie available online so that it can enjoy  monopoly power. Each time the movie is downloaded the production company has to pay 4 taka to the  internet service provider. Now it is deciding what price to charge for each download. The numbers below shows the demand schedule for the company, Price per download dollar  - 10, 8, 6, 4, 2, 0. Quantity of downloads demands 0, 1, 3, 6, 10, 15.

a) Calculate the total revenue and marginal revenue per download.  

b) To maximize profit what price should be charged and how many downloads would need to be sold?

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