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Cheat Sheet
Cheat Sheet
Psychological Effects: bundling -contrasting demand, add-on, versioning, prices ending in 9, difficult comparison. Cost: vehicle costs - commission to drivers | Fixed Cost: regulation. cost. acquisition/retention costs etc
Why Telcos promote combo plans: 1. Difficult comparison effect 2. Prospect theory loses weigh heavier than gains 3. overconfidence in future economic efficiency Network effect - incentives to pet owners, two part tariff (metered fare), versioning, add-on (flight serv.), bundle)
Current -(x)hours - $x
New - 1.5xhours - $1.5x
-Gf(x) =Pd/Pf-1
Gf(x) find corresponding Z
Z value =((C-B)-miu)/sigma
Available Seats 120, 96, 36. ****Protection C=miu, Find B
levels: 120-96 = 24 (biz class), 120-36=
84 (full fare), 120-0=120 (discounted)
The protection level on any given fare class is held constant until all seats in the
***120 seats, 120 - 96 -36 fixed, proct level: 24-84-120. If within limit for a fare class reduce that amount across
next-lower-priced fare class are reserved in dynamic nesting. No customer who
for booking limit. So if 2 seats in class 2, 118-94-34. but reduce from the lowest proct. level: 24-84-118