Question
14-4 Microwave Ovens A manufacturer of microwaves has discovered that male shoppers, on average, have lower values for microwave ovens than female shoppers.Additionally, male shoppers
14-4 Microwave Ovens A manufacturer of microwaves has discovered that male shoppers, on average, have lower values for microwave ovens than female shoppers.Additionally, male shoppers attribute almost no extra value to an auto-defrost feature, while female shoppers, on average, value the auto-defrost feature. There is little additional cost to incorporating an auto-defrost feature.The manufacturer is considering introducing two different models. The manufacturer has determined that men value a simple microwave at $70 and one with auto-defrost at $80, while women value a simple microwave at $80 and one with auto-defrost at $150. If there is an equal number of men and women, what pricing strategy will yield the greatest revenue? What if women comprise the bulk of microwave shoppers?
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