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Chapter 13 applied problems - Managerial Economics 1...

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Managerial Economics 1 Managerial Economics Applied Problems Managerial Economics Applied Problems Chapter 13: Applied problems 1, 3, 4, 5, 7, and 12 pp 566-567
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Managerial Economics 2 1. When Mc Donald’s Corp. reduced the price of its Big Mac by 75 percent if customer’s also purchased French fries and a soft drink, The Wall street Journal reported that the company was hoping the novel promotion would revive its U.S. sales growth. It didn’t. Within two weeks sales had fallen. Using your knowledge of the game theory what do you think disrupted McDonalds plans? Within in two weeks sales had fallen more than likely due to the game theory and Burger King being their rivals may have come up with an even better deal on the Whopper. Mc Donald’s may have figured this may bring in new customers and buy more Big Macs and less of something else even though more than one item was purchased. People may have viewed the price as still being too high.
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