In Nairobi City, the movie market is monopolistically competitive. In the long run, the demand for movies at the casino theatre is given as:
P-5.00-0.002q where "q" is the number of paid admissions in a month. The average cost function is given by
AC-6.00-0.004q+0.000001q
(a)To maximize profit, what price should the manager of Casino theatre
charge? (5marks)
(b) What would be the number of paid admissions per month? (5marks)
(c)How much profit will the firm earn?
(5marks)

Answer rating: 100% (QA)

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