Reference no: EM1316428
A profit maximizing firm produces three products X, Y and Z. The firm has no costs. There are three customers 1, 2 and 3. Each customer is willing to purchase at most one unit of each of the three products. The firm cannot price discriminate between customers. The following table presents the willingness to pay of each of the three customers for each of the three products:
|
Product
|
|
|
|
|
x
|
y
|
Z
|
|
Customer
|
|
|
|
|
1
|
10
|
12
|
5
|
|
2
|
8
|
14
|
0
|
|
3
|
4
|
16
|
7
|
So, for example, Customer 1 is willing to pay no more than $10 for purchasing one unit of product X and Customer 3 is willing to pay no more than $7 for purchasing one unit of product Z.
i) What will be the price of each product if the firm decides to sell them separately?
ii) Suppose, instead, that the firm decides to sell the three products only as a bundle.What will be the price of the bundle in this case?
iii) Which of the two alternatives above is better for the firm?
a) Which of the two alternatives above is better for each of the three customers?
iv) Can you think of a pricing and bundling strategy that is more profitable for the firm than the two strategies discussed above?
|
Test statistics utilizing chi square method
: To find out the test statistics utilizing chi square method. A professional bowler has been having trouble 'hitting the pocket' in order to get strikes.
|
|
Hypothesis test for one sample proportion
: At 95% confidence using the critical value approach, test to see if the percentage of defective systems produced by x-Game has exceeded the industry standard.
|
|
Calculate the variance of the number of breakdowns
: Bill Russ, the production manager at Ross Co., maintains detailed records on number of times each machine breaks down and requires service all through the week. Bill records show that the Puret grinder has required repair service according to the ..
|
|
Coffee is draining - application of calculus
: Coffee is draining - Application of calculus
|
|
Find out the price of product and profitable bundling price
: A profit maximizing firm produces three products X, Y and Z. The firm has no costs. There are three customers 1, 2 and 3. What will be the price of each product if the firm decides to sell them separately?
|
|
Determine the expected return and beta for the portfolio
: Multiple choice questions using beta, expected return and bond values and determine the expected return and beta for the portfolio.
|
|
Estimate standard error of the mean
: For a population with a mean of μ = 50 and a standard deviation of σ = 10, how much error, on average, would you expect between the sample mean (M) and population mean for:
|
|
Objective type questions related to finance fundamentals
: Objective type questions related to finance fundamentals and If you assume that your raises will just match the inflation rate
|
|
To find the probability using the bayes'' theorem
: A test on zoology is to be given next week. Suppose 75 percent of the students study for the test and 25 percent do not. If a student studies for the exam, the probability that he or she will pass is 0.90. If the student does not study, the pro..
|