Scenario 15-4 Black Box Cable TV Is Able to Purchase an Exclusive

question 324

Multiple Choice

Scenario 15-4
Black Box Cable TV is able to purchase an exclusive right to sell a premium movie channel (PMC) in its market area.Let's assume that Black Box Cable pays $150,000 a year for the exclusive marketing rights to PMC.Since Black Box has already installed cable to all of the homes in its market area,the marginal cost of delivering PMC to subscribers is zero.The manager of Black Box needs to know what price to charge for the PMC service to maximize her profit.Before setting price,she hires an economist to estimate demand for the PMC service.The economist discovers that there are two types of subscribers who value premium movie channels.First are the 4,000 die-hard TV viewers who will pay as much as $150 a year for the new PMC premium channel.Second,the PMC channel will appeal to about 20,000 occasional TV viewers who will pay as much as $20 a year for a subscription to PMC.
-Refer to Scenario 15-4.If Black Box Cable TV is able to price discriminate,what would be the maximum amount of profit it could generate?

• A) $500,000
• B) $600,000
• C) $850,000
• D) $925,000

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The level of skill or expertise in using SAS software, which is widely used for statistical analysis and data management.

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Guidelines for Assessment and Instruction in Statistics Education; provides recommendations for teaching statistics.

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Software specialized for statistical analysis, used by researchers and data analysts to perform complex calculations, data analysis, and visualization.

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The level of skill and knowledge in using the Statistical Analysis System (SAS) software, a tool for data management, advanced analytics, multivariate analysis, business intelligence, and predictive analytics.