Question
3. BBC Worldwide is setting prices for the upcoming Blu-Ray box set of the thirteenth season of Doctor Who. Market research department has found that
3. BBC Worldwide is setting prices for the upcoming Blu-Ray box set of the thirteenth season of Doctor Who. Market research department has found that demand appears to be more elastic in the US than in the UK. In particular ( E = -1.25 among American consumers, E = -1.16 among British). The marginal cost of producing a Blu-Ray box set is the same whether it is for the US or the UK market.
a) To maximuze profit, how much higher or lower (in percentage terms) must the price of 'The Complete 13th Series' be in the US than in the UK?
b) BBC Worldwide has tentatively set the price at $58 USD. What must be the price in the US?
c) Discuss the role of regional coding of the product in making this pricing strategy feasible or unfeasible.
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