Question

In: Economics

A community that is located in a resort area is trying to decide on the parking...

A community that is located in a resort area is trying to decide on the parking fee to charge at the town-owned beach. There are other beaches in the area, and there is competition for bathers among the different beaches. The town has determined the following function, which expresses the average number of cars per day q as a function of the parking fee p stated in dollars.
     q = 6000 - 1200p

a) Determine the fee that should be charged to maximize daily beach revenues. $  Blank 1. Fill in the blank,

b) What is the maximum daily beach revenue expected to be? $  Blank 2. Fill in the blank


c) How many cars are expected on an average day?  Blank 3. Fill in the blank, cars

Solutions

Expert Solution

  1. P= $2.5 to be charged to maximize daily beach revenue.
  2. Maximum daily beach revenue is $7500.
  3. On an average day 3000 cars are expected.

Rahul Sunny answered 1 year ago
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