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    type of strategy

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    The reservation prices of three classes of demanders of Cable Channels Bravo and Disney are given below:

    Class Bravo Disney
    30 Year Old Adults $11 $5
    12 to 15 year olds $ 8 $9
    3 to 7 year olds $ 9 $10

    It cost $4 to produce and distribute each Channel. The cable company can sell each separately, sell them as a bundle, or both.

    a. What pricing strategy would you recommend?
    b. How much more profitable is the best strategy compared to the next best?.

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    (a) There are two type of strategy that can be adopted. The first strategy is to sell the cable channels in a bundle to every one at a price of $16 ...

    Solution Summary

    The types of strategy are assessed.