Suppose a monopolistic theater serves two groups of audience, students and non-students. the demand of non students for movies is P1=100-q1, and the demand of students is p2=50-q2, assume that the marginal cost of serving an additional patron, regardless whether it is a student or non- student , is zero
(a) How much will be the student ticket and non-student ticket if the theater is allowed to charge different prices for different identify groups?
(b) If the theater can only charge a uniform price for all audience, how much is the ticket for all?
(c) Evaluate the social welfare with and without proce discrimination .