Week 5

Now I am going to repeat that there are two answers floating around the Internet that are WRONG!  Don't Use these answers.  Think about why they are wrong.  Can you ever sell to more that 100% of the market?  If either of these solutions is present on the quiz they will be given zero because that are wrong and they will be deemed plagiarism.

On question 9 of the quiz you can see error in this solution. The percents add to more than 100%. 

casino, 6000*21%= $1260

cruise, 7000*12%=$ 840

Bundle;8000*77%= $6160

Also on question 9 the below is an impossible solution for many reasons. For example, is there any evidence that 67% of the market will pay $10,000 for the bundle? Why would you add values across customers 1 and 2.  What is the meaning of $7000 from customer 1 and $2000 from customer 2? In bundling we are searching for distinctions in customer preferences for price per preference.

Particular	Cruise	Casino	Cost without bundling	Cost with bundling
-	a	b	(a*0.79)+(b*0.88)	(a+b)*0.67
Customer 1 Customer 2	$7,000.00 $2,000.00	$3,000.00 $6,000.00	$8,170.00 $6,860.00	$6,700.00 $5,360.00
Total	$9,000.00	$9,000.00	$15,030.00	$12,060.00

There is lots of good help on the Problem Set.  You will find tutoring videos and the information from the Practice Problem sessions on the weeks 2, 3 and 4 pages.  How to find these is in the video above.  Problem 1 help will be found on the week 2 page.  Problem 2 help will be found on the week 3 page. Problems 3 and 4 help will be found on the week 4 page.  As you work you can reach out the instructional team, but make sure you have tried the tutoring video help first.  Also, for help sent us an e-mail with what you have tried.  We will respond promptly.