Suppose you were head of a nationwide hotel chain that had a supply of 10,000 rooms. And suppose that the demand schedule for these rooms per night was as follows:

What would be the most profitable price, assuming you had a single-price policy? Now suppose you can price discriminate. How would you price your rooms and calculate the resulting total revenue?

Transcribed Image Text:

PRICE $100 80 70 60 50 20 10 QUANTITY DEMANDED 1,000 2,000 3,000 4,000 6,000 10,000 15,000