Amy is a Personal Trainer (PT). She can take as a MONOPOLY in her special training methods. The following table include the maximum price of her clients can afford weekly in two centres, Shatin and Causeway Bay respectively. The rent for the above centres is $350 in total weekly. For one hr class delivered, Amy has to give up her part time job which can earn $370/hr.
Assumption: no other costs for simplicity.
|
Client |
Centre |
maximum price of her clients can afford |
|
A |
Causeway Bay |
500 |
|
B |
Causeway Bay |
490 |
|
C |
Causeway Bay |
480 |
|
D |
Causeway Bay |
470 |
|
E |
Shatin |
460 |
|
F |
Causeway Bay |
450 |
|
G |
Shatin |
440 |
|
H |
Causeway Bay |
430 |
|
I |
Shatin |
420 |
|
J |
Causeway Bay |
410 |
|
K |
Shatin |
400 |
|
L |
Shatin |
390 |
|
M |
Shatin |
380 |
|
N |
Shatin |
370 |
(i) Amy wants to set a price for all clients. From the table, calculate the profit-maximizing price and what would be the economic profit?
(ii) Amy found that the maximum price of her clients can afford in the 2 centres are slightly different. She decides to set 1 price for clients in Shatin centre and 1 price for those in Causeway Bay centre.
Then, what would be profit-maximizing price for Shatin centre and Causeway Bay centre respectively? If she does it this way, would she serve more clients? Would she earn more total profit than (i)? Show your steps.
(iii) Is the Strategy in part (ii) feasible? Give 3 reasons behind.
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