Problem 4 USE INPUT VALUES AS GIVEN IN THE APPENDIX Consider a retailer selling a seasonable good. Based on the past experience, the management estimates the price response function, the relationship between demand D and price p, is given by the function D = 20,000 - p" (See appendix for the value of n) n+1 1. Find the retailer's potential market size. 2. For a single pricing strategy, find the maximum retailer’s revenue. 3. For a two-tier pricing strategy with SAR 150, SAR 200, Find the revenue of each of the two classes (Note, first the retailer serves the high price customers as much as possible, then the lowest price) 4. The retailer is thinking of adding a new pricing tier with SAR 100. Find the revenue of the new class (Note, this class is served at last)
