Question
(Two-Part Tariff #2 Cr) The Kiwi company (supplier) has introduced a new device called jPad. jPad is sold through Good Buy (retailer). Kiwi produces one
(Two-Part Tariff #2 Cr) The Kiwi company (supplier) has introduced a new device called jPad. jPad is sold through Good Buy (retailer). Kiwi produces one jPad at $200 and sells it to Good Buy at $400. Good Buy has estimated that demand for the jPad depends on the retail price (p) according to the demand function: D(p) = 2000 - 2p. With calculus/Excel used, optimal retailer's prices were calculated. (Independent pricing) The optimal retailer's price is $700. (Coordinated pricing) The optimal retailer's price is $600. In the two-part-tariff, the supplier sets a transfer price of $ ___.
A. | 200 | |
B. | 800 | |
C. | 600 | |
D. | 700 | |
E. | 100 | |
F. | 500 | |
G. | 300 | |
H. | 400 |
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