Explain briefly why profit is still likely to be lower

Assignment Help Business Economics

Reference no: EM13155684

Your firm sells a perfume for women. You believe you can get more profit by capturing more consumer surplus from each customer by implementing 2-part pricing at your store. Your marginal cost is $2 per bottle of perfume. The demand of a representative customer for your perfume is given by P = 30 (a) Implement a 2-part pricing scheme for your perfume. (b) Explain briefly why TOTAL profit (profit from entire sales) is still likely to be lower with this pricing scheme than with perfect price discrimination, despite charging a fixed fee equal to the entire Consumer Surplus of a typical consumer?

Reference no: EM13155684

Questions Cloud

Budgeted manufacturing overhead rate : Determine the budgeted manufacturing overhead rate for each department. Prepare the necessary journal entries to summarize the March transactions for Department 100.

Report bond interest expense problem : The bonds were sold for $177,000, priced to yield 12%. Legion records interest at the effective rate. Legion should report bond interest expense for the six months ended June 30, 2009, in the amount of:

What mass of magnesium nitrate do you need : prepare 250ml of a .5 mol/L aqueous solution of magnesium nitrae, Mg(N3)2. what mass of magnesium nitrate do you need?

Records reveal pretax financial accounting income : "Black Kitty Company recorded certain revenues of $10,000 and $20,000 on its books in 2007 and 2008, respectively. However, these revenues were not subject to income taxation until 2009. Company records reveal pretax financial accounting income an..

Explain briefly why profit is still likely to be lower : Explain briefly why TOTAL profit (profit from entire sales) is still likely to be lower with this pricing scheme than with perfect price discrimination, despite charging a fixed fee equal to the entire Consumer Surplus of a typical consumer?

Amount torrie repay at the end of third year : Torrie Company borrowed $50,000 on January 2, 2007. This amount plus accrued interest of 5% compounded annually will be repaid at the end of 3 years. What amount will Torrie repay at the end of the third year?

Test claim average age consumers by test statistics method : Using the confidence interval method, test the claim that the average age of consumers is at least 30 years ( α= 0.05). Test the same claim by using the test statistics method ( Z or T test).

Explain what is the nmr spectrum of benzene : What is the NMR spectrum of benzene, Suppose Dewar,Ladenburg,and Kekul?? had had a 13 C NMR spec- trometer.How many signals would the various candidates

How many liters of hydrogen gas will be needed : if 1.67l of oxygen reacts with hydrogen gas to produce liquid water how manny liters of hydrogen gas will be needed.

User Account

All Pages