Ask Question, Ask an Expert

+61-413 786 465

info@mywordsolution.com

Ask Business Economics Expert

Economics


Home >> Business Economics

A monopolist selling several different products can sometimes "price discriminate" by bundling products together. Here's an example.

Suppose the university is planning to offer a series of two concerts. The first program in the series consists of music by Chopin; the second, music by Stravinsky. There are four types of patrons with the following reservation prices for the concerts:

Romantic Type: $40 for Chopin, $20 for Stravinsky

Modern Type: $20 for Chopin, $40 for Stravinsky

Chopin Lover: $45 for Chopin, $5 for Stravinsky

Stravinsky Lover: $5 for Chopin, $45 for Stravinsky

Suppose for simplicity that there is only one individual of each type and everyone can be accommodated at either performance. Also suppose the university knows the distribution of types, but not any individual's given type.

a) Suppose first that separate tickets are oered for the two concerts. What is the profit maximizing price per ticket?

b) Suppose that only a single ticket for the series is oered. What is the profit maximizing price for a series ticket? Have profits increased? What is the intuition for this result?

c) Can you find a more profitable alternative?

Business Economics, Economics

  • Category:- Business Economics
  • Reference No.:- M91721809

Have any Question?


Related Questions in Business Economics

A recent study showed that 76 of marketers complete

A recent study showed that 76% of marketers complete transactions online. Suppose a random sample of 600 marketers is taken. What is the probability that between 426 and 480 marketers in the sample complete transactions ...

Explain and discuss the following quotepoliticians can be

Explain and discuss the following quote: "Politicians can be strange. They have been calling for the breakup of firms as diverse as energy companies and tech giants like Microsoft and Google because they believe these co ...

A survey of us adults found that 69 of those who text on

A survey of U.S. adults found that 69% of those who text on cell phones receive spam or unwanted messages. You randomly select 100 U.S. adults who text on cell phones. A) Determine whether you can use a normal distributi ...

Suppose we have a hypothetical economy with a marginal

Suppose we have a hypothetical economy with a Marginal Propensity to Consume of seventy-five percent (75%). Further assume business investment spending increases by $2,000. By how much will this change affect Gross Domes ...

A cartel is branch of an oligopoly there are still a

A cartel is branch of an oligopoly. There are still a handful of large firms and many smaller firms. For instance, the diamond industry and the petroleum industries are examples are oligopolies. However, the main differe ...

For each customer that calls into abc credit card billing

For each customer that calls into ABC credit card billing service call center, at the end of the phone conversation, the call center representative will offer each customer ONE of the following two products, a personal l ...

Discuss the budgeting process and describe the success or

Discuss the budgeting process and describe the success or failure of the process.

The distribution of the monthly amount women spent on

The distribution of the monthly amount women spent on supermarket in Houston city has a mean of $675 and a standard deviation of $80. A random sample of 64 families in this city is selected. Which Excel statement will fi ...

Determine whether the given value is a statistic or a

Determine whether the given value is a statistic or a parameter. Thirty percent of all dog owners poop scoop after their dog

The police lieutenant in charge of the traffic division

The police lieutenant in charge of the traffic division reviews the number of traffic citations issued by each of the police officers in his division. He finds that the mean number of citations written by each officer is ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As

Follow Us

© Copyright 2013-14 mywordsolution.com All rights reserved