Academia Nuts, Inc Is an Indoor Play Area Designed Especially

Essay

Academia Nuts, Inc is an indoor play area designed especially for academicians to work off some off the frustrations of having to deal with academic bureaucracies. You can come and smash a car with sledge hammers, dunk people who look like ivory tower intellectuals into vats of water and perform other activities useful in achieving Nirvana. There is no age limit, and management estimates that the typical customer who likes to things destroyed enough to want a membership card has an annual demand curve represented by the equation Q = 50 - .25P, where P is the price charged per visit and Q is the number of times per year a person will visit. As even really frustrated academicians are not strong enough to destroy too much and as most of the equipment is made of titanium steel, the Academia Nuts marginal cost per visit for any type of academician is only $80 The cars cost a lot and the insurance is really outrageous and based on customers through the door). Based on the foregoing demand curve, to maximize profit contribution, what should be a) the price of the annual membership card and b) the per-visit ticket price for a membership card holder?