A retailer buys Dalmatian stuffies for $6 each. (Assume that the retailer has no other variable costs). The retailer can only charge by the dollar so no need to consider cents -- e.g., $3 is a price you could choose, $3.11 or $2.99 are not. The potential customers have the following WTP. Student (1= yes) Parent (1=yes) Cat Lover (yes =1) Over 65? (1=yes) WTP 1 $20 O $20 1 $18 1 $15 O $15 O $14 O $14 1 $14 O $14 1 $13 O $10 O $8 1 1 1 1 1 1 1 1 $8 O $7 1 1 1 $7 1 1 $5 O $5 1 $5 O $4 1 $3 1 1 1 1 1 If you can only charge a single price what is the best price to maximize revenue?

A retailer buys Dalmatian stuffies for $6 each. (Assume that the retailer has no other variable costs). The retailer can only charge by the dollar so no need to consider cents -- e.g., $3 is a price you could choose, $3.11 or $2.99 are not. The potential customers have the following WTP. Student (1= yes) Parent (1=yes) Cat Lover (yes =1) Over 65? (1=yes) WTP 1 $20 O $20 1 $18 1 $15 O $15 O $14 O $14 1 $14 O $14 1 $13 O $10 O $8 1 1 1 1 1 1 1 1 $8 O $7 1 1 1 $7 1 1 $5 O $5 1 $5 O $4 1 $3 1 1 1 1 1 If you can only charge a single price what is the best price to maximize revenue?

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter3: Demand Analysis

Section: Chapter Questions

Problem 2.5CE

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