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  • Case of Cambridge Software Corporation

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    sasharma82
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    CSC is considering whether to offer one or multiple versions of its Modeler software. The document provides demand curves for three potential versions - Industrial, Commercial, and Student. It instructs the reader to analyze the possible prices and profits for each version individually and as a bundle to determine the optimal pricing strategy for CSC to maximize profits. The conclusion is that if offering only one version, CSC should offer the Industrial version for $600.

    Original Description:

    cambridge software corporation

    Original Title

    Mgeg12 Csc 6

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    CSC is considering whether to offer one or multiple versions of its Modeler software. The document provides demand curves for three potential versions - Industrial, Commercial, and Student. It instructs the reader to analyze the possible prices and profits for each version individually and as a bundle to determine the optimal pricing strategy for CSC to maximize profits. The conclusion is that if offering only one version, CSC should offer the Industrial version for $600.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pptx, pdf, or txt
    346 views10 pages

    Case of Cambridge Software Corporation

    Uploaded by

    sasharma82
    CSC is considering whether to offer one or multiple versions of its Modeler software. The document provides demand curves for three potential versions - Industrial, Commercial, and Student. It instructs the reader to analyze the possible prices and profits for each version individually and as a bundle to determine the optimal pricing strategy for CSC to maximize profits. The conclusion is that if offering only one version, CSC should offer the Industrial version for $600.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pptx, pdf, or txt
    of 10

    Case of Cambridge Software Corporation

    If CSC offers only one version of Modeler, which version should it offer? At what price?

    P
    2500

    Demand function for Industrial (No substitutes case)

    2000

    600 300

    100
    5000 7000 27000 42000 542000

    Demand function for Commercial (No substitutes case)

    1200 1000

    300 225 60
    5000 7000 27000 42000 542000

    Demand function for Student (No substitutes case)

    200 175 150 100 50


    20000 35000 42000 40000 542000

    Pointers
    What are the possible prices for each

    version?
    Revisit the demand functions

    What is CSCs objective? Profit maximization

    Pointers contd.
    Which version of Modeler has the most elastic

    demand?
    Student

    Which segment is the largest segment? Students

    CSC Single version case


    What is the profit maximizing price for

    Student?
    Calculate profits for each possible prices? Similarly find the profit maximizing price for Commercial and Industrial.

    Which one is the optimal version? One with the maximum profit.

    Conclusion

    If CSC offers one version, it should offer

    Industrial at $600

    Multiple versions?
    Should CSC offer multiple versions? If CSC decides to offer multiple versions, which are

    the versions that it should offer?


    At what prices? If CSC decides to offer multiple versions, should it

    offer 2 versions or all 3?


    If CSC decides to offer two versions, which are the

    versions that it should offer?

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