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In: Economics

Assume that you manage a firm that sells calculators. You want to sell calculators to both...

Assume that you manage a firm that sells calculators. You want to sell calculators to both commercial users and home users, and so you have developed 2 types of calculators - fancy and basic calculators. Each customer type has the following valuations for each type of calculator: Home User Commercial User Fancy Calculator $100 $200 Basic Calculator $30 $50 If you have an 100 home users and 100 commercial users that at most will buy 1 calculator each, you will maximize total revenue by setting what price for the fancy calculator? (Write answer without the dollar sign.)

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Expert Solution

Revenue maximizing price of fancy calculators = 100 or 200

Rahul Sunny answered 2 years ago
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