For the first time, Hercules has begun selling books onlinein

response to competition from other online sellers and in its quest for

new profit sources. The average cost per book sold online is only $4.

As part of its online selling strategy, it sends weekly e-mails to

preferred customers announcing which books are new in paperback.

For this segment, it sets an average price (including shipping) of $12.

According to the demand curve in part (a), only the highest value

consumers (whose willingness to pay is $12 or more) purchase at this

price. Check that these are the first 6 thousand book buyers on the

demand curve. In turn, because of increased competition, Hercules

has reduced its store price to $7 per book.