Some pricing strategies seem to run counter to the interests of the firm, yet when you look

more carefully, they make perfect sense. Five examples are given below. Pick two of create short analysis of why you think the firms price the way they price. Draw on the

lessons of this week to explain your answer.

*****learning about monopolies and price discrimination

• Why are there sales after Christmas?

The usual explanation is that stores are trying to get rid of excess inventory

before the spring season. But can that really be the whole explanation? After all,

retailers are really good at predicting demand. Also, inventory costs for many of

the things that go on sale are not that high. For example, while some items go

out of fashion many of the things on sale after Christmas could be cheaply stored

and sold at a later date.