A department store has purchased 5,000 swimsuits to be sold during the summer sales season. The season lasts three months, and the store manager forecasts that customers buying early in the season are likely to be less price sensitive and those buying later in the season are likely to be more price sensitive. The demand curves in each of the three months are forecast to be as follows: and

. If the department store is to charge a fixed price over the entire season, what should it be? What is the resulting revenue? If the department store wants dynamic prices that vary by month, what should they be? How does this affect profits relative to charging fixed prices? If each swimsuit costs

$40 and the store plans to charge dynamic prices, how many swimsuits should it purchase at the beginning of the season?