Essay
Hart's Pinefall Lodge provides guided hunts and fishing trips to their customers in Ontario, Canada. The market price for high quality hunting and fishing trips is $1,250. The market price for standard quality hunting and fishing trips is $750. The marginal cost of providing high quality trips each season is: MC(Q) = 156.25Q. The marginal cost of providing standard quality trips each season is: MC(Q) = 62.5Q. In order to be able to sell their hunting and fishing trips at high quality prices, Hart's Pinefall Lodge must pay an advertising fee of $500 each season. Should the Lodge pay the fee and sell high quality trips?
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