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Unformatted text preview: Versioning Test Problem: Answer Key Variation of the Case 1 Perceived Benefit ($) Version 50 80 70 L H Segment A Segment B 90 • Offering L only ± P L =70 ± Sell L to ONLY A ± Profit=70×(30+0)=2,100 • Offering H only ± P H =80 ± Sell H to both A and B ± Profit=80×(30+10)=3,200 • Offering both L & H (Versioning) ± Rule of thumb: Sell each version to the segment with higher valuation That is, sell L to segment A and sell H to segment B ± Set P L = $70 to sell L to A and set P H = $90 to sell H to B ± Profit=70×30+90×10=3,000 (30 consumers) (10 consumers) Offering H only @$80 is the profit maximizing choice When MC L =0 and MC H =$30? Offering both L & H @$70 & $90 respectively is the profit maximizing choice (Profit=$2,700)...
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This document was uploaded on 03/03/2012.
- Fall '08