AVR cinema hall has 500 seats. Cost of each ticket is Rs.300 per seat. At this price, the owner will be able to fill the entire hall. If the price of the ticket goes up by Re.1, the number of seats sold goes down by 1. At what price of the ticket, will he maximize his revenue?

450

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350

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425

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none of these

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Solution

The correct option is D
none of these

Revenue will be maximum when the cost = number of seats, as revenue = (cost of each seat) $\times$ (number of seats) i.e. the value of both = 400

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AVR cinema hall has 500 seats. Cost of each ticket is Rs.300 per seat. At this price, the owner will be able to fill the entire hall. If the price of the ticket goes up by Re.1, the number of seats sold goes down by 1. At what price of the ticket, will he maximize his revenue?

The correct option is D none of these Revenue will be maximum when the cost = number of seats, as revenue = (cost of each seat)×(number of seats) i.e. the value of both = 400

The correct option is D
none of these

Revenue will be maximum when the cost = number of seats, as revenue = (cost of each seat) $\times$ (number of seats) i.e. the value of both = 400