The scientists at Zipfer, an up and coming pharmaceutical company, have had a major
breakthrough in painkillers and hope to replace frequent use of headache medicine by patients
with severe recurring headaches. Currently, the average target consumer spends $ 100 for an
office visit to get an initial prescription from a doctor appointment and $40 a month for the drug.
However, Zipfer offers a single injection, Sweet Relief, that guarantees no headaches for three
months but the injection will have to be administered during a doctor office visit only.
The doctor office visit costs the patient $70 in addition to the price of the drug and the treatment
has to be repeated every three months. It also requires an additional $15 a month in other
medicines to curb side effects.
What is the EVC of Sweet Relief for a single patient for 1 year?
: (Product Line) Consider the Product line pricing problem discussed in class.
that every consumer in the market buys at most one toy. The following table gives you the WTP
(i) If we are to launch only one version, which one should it be and what should be the
TOY A Table: