A manufacturer of microwaves has discovered that female shoppers have little value for microwaves and attribute almost no extra value to an autoadditional cost to incorporating an auto-defrost feature. Since men and women cannot be charged different prices for the same production with auto-defrost at $150, while women value a simple microwave at $67 and one with auto-defrost at $83. Suppose the manufacturer is considering three pricing strategies: 1. Market a single microwave, with auto-defrost, at $83, to both men and women. 2. Market a single microwave, with auto-defrost, at $150, to only men. 3. Market a simple microwave to women, at \$67. Market a microwave, with auto-defrost, to men at $133. individual will purchase the microwave. Suppose that, instead of one man and one woman, the market for this microwave consisted entirely of men. For simplicity, you can assume this means that there are two men, and no women. Under these conditions, pricing strategy would maximize revenue for the manufacturer. The pricing model for iTunes has been to price songs individually. In contrast, Spotify opted to offer unlimited song playing for a monthly fee. True or False: Spotify's pricing model will likely yield more profit if the value of the "bundle" of unlimited songs is more homogeneous across consumers than the values of the individual songs. True False A manufacturer of microwaves has discovered that female shoppers have little value for microwaves and attribute almost no extra value to an autoadditional cost to incorporating an auto-defrost feature. Since men and women cannot be charged different prices for the same production with auto-defrost at $150, while women value a simple microwave at $67 and one with auto-defrost at $83. Suppose the manufacturer is considering three pricing strategies: 1. Market a single microwave, with auto-defrost, at $83, to both men and women. 2. Market a single microwave, with auto-defrost, at $150, to only men. 3. Market a simple microwave to women, at \$67. Market a microwave, with auto-defrost, to men at $133. individual will purchase the microwave. Suppose that, instead of one man and one woman, the market for this microwave consisted entirely of men. For simplicity, you can assume this means that there are two men, and no women. Under these conditions, pricing strategy would maximize revenue for the manufacturer. The pricing model for iTunes has been to price songs individually. In contrast, Spotify opted to offer unlimited song playing for a monthly fee. True or False: Spotify's pricing model will likely yield more profit if the value of the "bundle" of unlimited songs is more homogeneous across consumers than the values of the individual songs. True False
