Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Assume that before the launch of iPhone in 2007, Apple had conducted an experiment examining 2,400 consumers to assess the potential demand of iPhones across
Assume that before the launch of iPhone in 2007, Apple had conducted an experiment examining 2,400 consumers to assess the potential demand of iPhones across different price points. First, they divided them among iPod owners (1,200 of them, half the sample), and non-iPod owners. They were all offered the opportunity to pre-order one 4GB iPhone at a specified price. One third of the participants were offered a price of $299 (low); one third a price of $399 (medium); and one third a price of $499 (high). In the table below you'll see what percentage of each group pre- ordered the corresponding iPhone. Segment $299 $399 $499 iPod nonowner 12.1% 10.2% 8.3% iPod owner 19.2% 13.8% 9.6% Each cell represents 400 participants. Assuming that the production cost of the 4GB iPhone is $150 per unit, that the target market size is 100 million customers, that the previous study is representative of the total market, that 50% of the target population owns an iPod and that Apple wants to maximize profits, which would be the optimal price for each segment? O $399 for iPod non-owners $499 for iPod owners O $299 for iPod non-owners $399 for iPod owners O $299 for iPod non-owners $499 for iPod owners O $499 for iPod non-owners $299 for iPod owners O $499 for iPod non-owners $399 for iPod owners O $299 for iPod non-owners $299 for iPod owners O $399 for iPod non-owners $399 for iPod owners
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered 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