PROBLEM I. A nightclub manager realizes that demand for drinks is more elastic among students and tries to determine the optimal pricing schedule. Specifically, he estimates that the demand functions are given by g.-30-6P1 for students and = 24-4p for non-students. Assume that drinks cost the nightclub S2 each. Q1. If the market cannot be segmented, what is the uniform monopoly price? (a) $3.10 (b) $3.30 (c) S3.50 (d) S3.70 (e) S4.20 Q2. If the nightclub can charge according to whether or not the customer is a student but is limited to linear pricing, what price (per drink) should be set for students? (a) $3.10 (b) S3.25 (c) $3.40 (d) S3.50 (e) $3.80 Q3. Under the same conditions of Q2, what price (per drink) should be set for non-students? (a) s3.80 (b) $4.00 (c) S4.30 (d) $4.60 (e) $5.20 Solution (Q1) (d) Without segmentation, p1 = p2 = p q1 = 30 - 6p q2 = 24 - 4p Market demand: q = q1 + q2 = 30 - 6p + 24 - 4p q = 54 - 10p 10p = 54 - q p = 5.4 - 0.1q Profit is maximized when Marginal revenue (MR) equals Marginal cost (MC). Total revenue (TR) = p x q = 5.4q - 0.1q2 MR = dTR/dq = 5.4 - 0.2q Equating with MC, 5.4 - 0.2q = 2 0.2q = 3.4 q = 17 p = 5. - (0.1 x 17) = 5.4 - 1.7 = $3.7 (Q2) (d) With segmentation, profit is maximized when MR1 = MC and MR2 = MC For students, q1 = 30 - 6p1 6p1 = 30 - q1 p1 = (30 - q1) / 6 TR1 = p1 x q1 = (30q1 - q12) / 6 MR1 = dTR1/dq1 = (30 - 2q1) / 6 Equating with MC, (30 - 2q1) / 6 = 2 30 - 2q1 = 12 2q1 = 18 q1 = 9 p1 = (30 - 9) / 6 = 21 / 6 = $3.5 (Q3) (b) For non-students, q2 = 24 - 4p2 4p2 = 24 - q2 p2 = 6 - 0.25q2 TR2 = p2 x q2 = 6q2 - 0.25q22 MR2 = dTR2/dq2 = 6 - 0.5q2 Equating with MC, 6 - 0.5q2 = 2 0.5q2 = 4 q2 = 8 p2 = 6 - (0.25 x 8) = 6 - 2 = $4.

1. Question 1. List and describe three rules of natural justice, provide an example of a situation
where each of the three selected rules may be breached or contravened ( you may make up
examples, draw from your own experience, or use examples from the textbook.)
Solution
The principles of natural justice is fairness and guarantee a fair decision is reached by an
objective decision maker.
Maintaining fairness protects the rights of individuals and increase public confidence in the
process.
The principles of natural justice were evolve from the Romans who admit that few legal
principles were "natural" or self-evident and did not need a statutory basis.
These two primary legal safeguards carrry out all decisions by judges or government officials
when they take quasi-judicial or judicial decisions.
The 3 common law rules are referred to in alliance to natural justice or procedural fairness.
The Hearing Rule
A person must be allowed an adequate opportunity to present their case where certain interests
and rights may be adversely altered by a decision-maker.
To ensure that these rights are valued, the authority which is assigned for deciding give both the
opportunity to prepare and present evidence and to chase to arguments presenting by the opposite
side.
When oversee an investigation in relation to a complaint it is important that the person being
accuse against is advised of the affirmations in as much detail as possible and given the
opportunity to reply to the affirmations.
The Bias Rule
This rule states that no one concern to be judge in his or her case. This is the requirement that the
deciding authority must be unbiased when according the hearing or making the judgment.
Additionally, investigators and decision-makers must act without bias in all channels connected
with the making of a decision.
A decision-maker must be impartial and must make a decision based on a balanced and
considered assessment of the information and evidence before him or her without fondness over
another party.
Investigators should ensure that there is no battle of interest which would make it inappropriate
for them to conduct the investigation .
The Evidence Rule

2. This rule is that an administrative decision must be based upon analytical proof or evidence
material.
Investigators and decision makers should not base their decisions on mere belief or gut feelings .
Rather, an investigator or decision maker should be able to clearly point to the evidence on
which the inference or decision is based.
Evidence (arguments, allegations, documents, photos, etc..) conferred by one party must be
expose to the other party, who may then subject it to analysis.
For example - the idea of fair hearing particularly varies significantly in different contexts such
as whether it is a sophisticated full fledged hearing or a blunt and minimal one ; hearing prior to
the decision or post decisional hearing.
Case : Tanjong jaga vs minister of labour (1987)
- Tanjong jaga contend that it was a night club and as such the NU of HB &R workers not the
competent union to represent its employee. It challenged the unilateral decision of the registrar to
the countrary, complaining that he failed to give an apportunity to be heard on this conflict .
The supreme Court held that the registrar in the case was appeased that the majour business of
the nightclub was in the operation of the bar S. C. Judege Abdool cadeer - allowing a hearing to
the night club would not have wide any difference.