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Berkley Gold and Tennis Club offers golf and tennis memberships. Marketing analysis of the local nei… Show more Berkley Gold and Tennis Club offers golf and tennis memberships. Marketing analysis of the local neighborhood served by Berkley Golf $ Tennis Club shows that there are two types of families that might join the club: gold-oriented families, which are primarily interested in gold but enjoy playing some tennis, and tennis-oriented families, which are primarily interested in tennis but enjoy playing some golf. The study further estimated that there 400 golf-oriented families and 300 tennis-oriented families in the neighborhood, and the estimated demand priced for golf and tennis memberships by family are given below. There is no way to identify family types for pricing purposes and all costs are fixed so that maximizing total revenue is equivalent to maximizing profit. Demand Prices for Gold and Tennis Memberships Type of family Golf membership only Tennis membership only Golf-oriented $250 $100 Tennis-oriented $50 $200 a. If Berkley Gold & Tennis Club plans to offer golf and tennis memberships separately, what prices should be charged for each kind of membership if Berkeley wishes to maximize profit? How much total revenue can be generated each month under this pricing plan? b. The manager of Berkley Gold & Tennis Club has just finished her MBA degree and has an idea that bundling golf and tennis markets memberships might increase profit for the club. Are the conditions right for bundle pricing to increase profit at Berkeley Golf & and Tennis? c. What is the optimal price to charge for golf and tennis (bundled) membership? How much revenue will this produce for Berkley Gold a& Tennis? Is bundling a profitable pricing tactic for the club? • Show less

The two largest diner chains in Kansas compete for weekday breakfast customers. The two chains, Gold… Show more The two largest diner chains in Kansas compete for weekday breakfast customers. The two chains, Golden Inn and Village Diner, each offer weekday breakfast customers a “breakfast club” membership that entitles customers to a breakfast buffet between 6: 00 A.M. and 8:30 A.M. Club Memberships are sold as “ passes” good for 20 weekday breakfast visits. Golden Inn offers a modest but tasty buffet, while Village Diner provides a wider variety of breakfast items that are also said to be quite tasty. The demand function for breakfast club memberships are QG = 5,000 – 25PG + 10PV Qv = 4,200 – 24Pv + 15G Where QG and Qv are the number of club membership sold monthly and PG and PV are the prices of club memberships, both respectively, at Golden Inn and Village Diner chains. Both diners experience long-run constant costs of production, which are PG = BRG (PV) = 125 + 0.2PV PV = BRV (PG) + 125 + 0.3125PG a. If Village Diner charges $200 for its breakfast club membership, find the demand inverse demand, and marginal revenue functions for Golden Inn. What is the profit maximizing price for Golden Inn given Village Diner charges a price of $200? Verify mathematically that this price can be obtained from the appropriate best-response curve given above. b. Find the Nash equilibrium prices for the two diners. How many breakfast club memberships will each diner sell in Nash equilibrium? How much profit will each diner make? c. How much profit would Golden Inn and Village Diner earn if they charged prices of $165 and $180? • Show less