BUNDLING AT THE SYMPHONY
Value of Piece
Type of Patron
"Old Favorite" "Avant Garde"
(70% of Market Potential)
(30% of Market Potential) $2.00 $5.00
Total Market = 1000 Patrons (700 Conservative and 300 Progressive)
A concert consists of three pieces and each season consists of a number of concerts.
(a) How can this orchestra organize a concert as a combination of conservative Avant Garde pieces so as to maximize profits? Assume that costs are the same for all mixes.
The solution examines bundling to maximize profits for a conservation.