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(3) BrainType Your software startup has just completed the latest version of BrainType, a mindreading word processor that translates thoughts into text. Since you are
(3) BrainType Your software startup has just completed the latest version of BrainType, a mindreading word processor that translates thoughts into text. Since you are the cuttingedge frontier, you have no direct competitors. As marketing manager, you must decide how to price BrainType. You commission a study that suggests that there are two markets: professional writers and dabbling hobbyists. There are one million professionals and two million hobbyists. Professionals are willing to pay up to $400 and hobbyists up to $100 for the fullfeature version. A scaleddown version is worth $50 to hobbyists and nothing to professionals. Both versions are essentially free to produce. (a) What prices of the two versions generate the most revenue? (b) Suppose that, instead of the scaleddown version, the rm offers an intermediate version worth $200 to professionals and $75 to hobbyists. What prices generate the most revenue now? Is the rm better off selling the intermediate or scaleddown version
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