Answer Happy

QUESTION 11
A pop star has two types of fans: avid fans who love everything she does and casual fans who like her music but will not pay as much for it. She decides to offer two versions
of her new album; a deluxe version that comes with some additional tracks and some additional pictures and a standard version. She wants to price the two versions so the
avid fans will buy the deluxe version and her casual fans will buy the standard version.
The table below shows the willingness to pay of her casual and avid fans for the two versions
/Type of Fan
(Casual fans
Avid fans
Maximum willingness to pay for standard version
$14
$20
Maximum willingness to pay for deluxe version
$22
$45
She sets the price of the standard version at $14 so that the casual fans will buy it.
Given what she is charging for the standard version, what is the maximum price she can charge for the deluxe version if she wants her avid fans to buy it instead of the
standard version?
Note: The avid fans must prefer the deluxe version to the standard version at the two prices
QUESTION 11 Apop star has two types of fan avid tans who love everything she does and casual fans who like her music but will not pay as much for it. She decides to offer two versions of her new album a deluxe version that comes with some additional tracks and some addisional pictures and a standard version. She wants to price the two versions so the avid fans will buy the deluse version and her casual fans will buy the standard version The table below shows the willingness to pay of her casual and avid fans for the two versions Type of Fan Avid far Maximum willingness to pay for standard version $14 $20 Maximum willingness to pay for deluxe version $22 $45 She sets the price of the standard version at $14 so that the casual fans will buy it Given what she is charging for the standard version, what is the maximum price she can charge for the deluxe version if she wants her avid fans to buy it instead of the standard version? Note: The avid fans must prefer the deluxe version to the standard version at the two prices