Question: A pro basketball team faces two distinct demand groups for season tickets. One group of ticket demand is from businesses with inverse demand as Ps

A pro basketball team faces two distinct demand groups for season tickets. One group of ticket demand is from businesses with inverse demand as Ps = 1,000- 5Qs

and the other group is individual fans with demand PF = 500 - Q, FThe marginal cost of

supplying an additional season ticket is MC= 100 and Q is quantity of season tickets. (Note: Marginal Revenue, MR, of a linear inverse demand function is twice its slope with same intercept.)

a.Find the prices to charge for businesses (Ps) and other fans (PF) that maximizes profits.

b.How many tickets are sold to businesses and other fans?

c.Which group do you think has more elastic demand? How does elasticity relate to price charged for the groups?

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