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Question 2 EasyTax markets both a deluxe and a standard version of its software. The deluxe version contains additional features that are likely to appeal to sophisticated users. The marginal costs of producing and distributing the two versions are virtually equal, and equal to zero. The market is equally divided into two types of users, sophisticated and unsophisticated (and assume one user of each type). The maximum willingness to pay for both types of users for the standard and deluxe versions are given in the following table: Standard 20 Unsophisticated Sophisticated 35 (a) Assuming that the company producing EasyTax can distinguish between sophisticated and unsophisticated users (because, for instance, the sophisticated users are registered accountants), what are the optimal prices to be charged to each category of users? What is the company's profit? (b) Assume now that the company cannot distinguish between the two types of user. What are the optimal prices for the two versions? What is the total profit? Deluxe 20 100

Question 2 EasyTax markets both a deluxe and a standard version of its software. The deluxe version contains additional features that are likely to appeal to sophisticated users. The marginal costs of producing and distributing the two versions are virtually equal, and equal to zero. The market is equally divided into two types of users, sophisticated and unsophisticated (and assume one user of each type). The maximum willingness to pay for both types of users for the standard and deluxe versions are given in the following table: Standard 20 Unsophisticated Sophisticated 35 (a) Assuming that the company producing EasyTax can distinguish between sophisticated and unsophisticated users (because, for instance, the sophisticated users are registered accountants), what are the optimal prices to be charged to each category of users? What is the company's profit? (b) Assume now that the company cannot distinguish between the two types of user. What are the optimal prices for the two versions? What is the total profit? Deluxe 20 100

MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
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Problem 1P
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### Question 2 EasyTax markets both a deluxe and a standard version of its software. The deluxe version contains additional features that are likely to appeal to sophisticated users. The marginal costs of producing and distributing the two versions are virtually equal, and equal to zero. The market is equally divided into two types of users, sophisticated and unsophisticated (and assume one user of each type). The maximum willingness to pay for both types of users for the standard and deluxe versions are given in the following table: | | Standard | Deluxe | |----------------|----------|--------| | Unsupervised | 20 | 20 | | Sophisticated | 35 | 100 | #### (a) Assuming that the company producing EasyTax can distinguish between sophisticated and unsophisticated users (for instance, the sophisticated users are registered accountants), what are the optimal prices to be charged to each category of users? What is the company's profit? #### (b) Assume now that the company cannot distinguish between the two types of users. What are the optimal prices for the two versions? What is the total profit? Note: No graphs or diagrams are provided in the question.
Transcribed Image Text:### Question 2 EasyTax markets both a deluxe and a standard version of its software. The deluxe version contains additional features that are likely to appeal to sophisticated users. The marginal costs of producing and distributing the two versions are virtually equal, and equal to zero. The market is equally divided into two types of users, sophisticated and unsophisticated (and assume one user of each type). The maximum willingness to pay for both types of users for the standard and deluxe versions are given in the following table: | | Standard | Deluxe | |----------------|----------|--------| | Unsupervised | 20 | 20 | | Sophisticated | 35 | 100 | #### (a) Assuming that the company producing EasyTax can distinguish between sophisticated and unsophisticated users (for instance, the sophisticated users are registered accountants), what are the optimal prices to be charged to each category of users? What is the company's profit? #### (b) Assume now that the company cannot distinguish between the two types of users. What are the optimal prices for the two versions? What is the total profit? Note: No graphs or diagrams are provided in the question.
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