Question

Suppose executives at an art museum know that 100 adults are willing to pay $12 for admission to the museum on a given weekday. Suppose the executives also know that 200 students are willing to pay $8 for admission on the same weekday. The cost of operating the museum on that weekday is $2,200. How much profit will the museum earn in the weekday under attention if it engages in price discrimination

Answer 1

The museum will earn $600 on a weekday.

What is an art museum?

• A structure or area designated for the exhibition of art, typically from the museum's own collection, is known as an art museum or gallery.
• It may be owned by the government or a private individual, and access may be open to everyone or subject to limitations.

Who are executives?

• An executive manages operational activities for their company or organization and is typically in charge of developing policies and strategies to achieve organizational objectives.
• Executives frequently travel to conferences, meetings, and local, regional, national, and worldwide offices.

Solution -

Adults willing to pay = 100 and their fees = $12.

Students are willing to pay = 200 and their fees = $8.

Operating cost of museum = $2,200.

To find the profit, do the following:

$(100 * 12) + (200 * 8) = 1200 + 1600 = 2800\\2800 - 2200 = 600$

Therefore, the museum will earn $600 on a weekday.

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