Paradise Cruises has a monopoly in renting luxury yachts for sailing in the Caribbean Sea. In winter

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Paradise Cruises has a monopoly in renting luxury yachts for sailing in the Caribbean Sea. In winter its monthly inverse demand function is p = 200 – q. In summer the inverse demand function is p = 200 – 2q. Paradise has a total of 50 yachts available for rental on a monthly basis.
a. Which season is the peak season. Why?
b. What are the profit-maximizing prices in both seasons?

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Managerial Economics and Strategy

ISBN: 978-0321566447

1st edition

Authors: Jeffrey M. Perloff, James A. Brander

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