Answered step by step
Verified Expert Solution
Question
1 Approved Answer
A manufacturer of microwaves has discovered that female shoppers have little value for microwaves and attribute almost no extra value to an auto defrost feature.
A manufacturer of microwaves has discovered that female shoppers have little value for microwaves and attribute almost no extra value to an auto defrost feature. Male shoppers generally value microwaves more than women do and attribute greater value to the autodefrost feature. 111ere is little additional cost to incorporating an autodefrost feature. Since men and women cannot be charged different prices for the same product, the manufacturer is considering introducing two different models. The manufacturer has determined that men value a simple microwave at $75 and one with auto-defrost at $139, while women value a simple microwave at $64 and one with auto-defrost at $i'5. Suppose the manufacturer is considering three pricing strategies: 1. Market a single microwave, with autodefrost, at $?5, to both men and women. '2. Market a single microwave, with autodefrost, at $139, to only men. 3. Market 3 simple microwave to women, at $64. Market a microwave, with autodefrost, to men at $121 For simplicity, assume there is only 1 man and 1 woman and that if the price of a microwave is equal to an individual's willingness to pay, the individual will purchase the microwave. Use the following table to indicate the revenue from men, the revenue from women, and the total revenue from each strategy. Revenue from Revenue from Total Revenue from Strategy lWomen Men 1. Auto-Defrost Microwave only at $75 2. Auto-Defrost Microwave only at $139 3. Simple Microwave at $64, Auto-Defrost Microwave at $12? \"Hi Illg Suppose that, instead of one man and one woman, the market for this microwave consisted entirer of men. For simplicity, you can assume this means that there are two men, and no women. Under these conditions, pricing strategy v would maximize revenue for the manufacturer
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started