urgnt plz 7. The Acme Software Corp. has developed - at a cost of $500,000 - two software programs forcomputers: a word processor; and a spreadsheet. Acme's marketing department has determined thatthere are three categories of potential buyers of these programs - but there is no way of identifyingan individual's category at the time of sale. The three categories, along with the numbers of (annual)buyers and the maximum willingness to pay (w.t.p.) of each group, are provided in the followingtable. Since this is software, the marginal costs of producing and selling (online) are zero.Number ofBuyer category potential buyersGeneralist10,00010,000Sort-of geekSuper-geek10,000W.t.p. for wordprocessor$60$50$25W.t.p. forspreadsheet$50$125$140a. Acme currently sells the two programs separately. If Acme is maximizing its profits, whatprice is it charging for each program? Explain.b. What would be the price for each program that would maximize the sum of consumersurplus plus producer surplus? Explain c. Is there a difference between your answers to #a and #b? Explain.d. Acme's V.P. for Marketing - Ms. Lotta Sales - has hired you as a consultant to advise heras to whether there is a way for Acme to change its pricing, so as to increase its profits. Is there anyspecific advice that you can give her? Explain.

7. The Acme Software Corp. has developed at a cost of $500,000 - two software programs for computers: a word processor; and a spreadsheet. Acme's marketing department has determined that there are three categories of potential buyers of these programs - but there is no way of identifying an individual's category at the time of sale. The three categories, along with the numbers of (annual) buyers and the maximum willingness to pay (w.t.p.) of each group, are provided in the following table. Since this is software, the marginal costs of producing and selling (online) are zero.

7. The Acme Software Corp. has developed at a cost of $500,000 - two software programs for computers: a word processor; and a spreadsheet. Acme's marketing department has determined that there are three categories of potential buyers of these programs - but there is no way of identifying an individual's category at the time of sale. The three categories, along with the numbers of (annual) buyers and the maximum willingness to pay (w.t.p.) of each group, are provided in the following table. Since this is software, the marginal costs of producing and selling (online) are zero.

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: Monopoly

Section: Chapter Questions

Problem 4PA

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