Anew york city daily newspaper called “manhattan today” charges an annual subscription fee of $162. customers prepay their subscriptions and receive 240 issues over the year. to attract more subscribers, the company offered new subscribers the ability to pay $160 for an annual subscription that also would include a coupon to receive a 40% discount on a one-hour ride through central park in a horse-drawn carriage. the list price of a carriage ride is $150 per hour. the company estimates that approximately 30% of the coupons will be redeemed.
how much revenue should manhattan today recognize upon receipt of the $130 subscription price?

Suppose that two firms produce differentiated products and compete in prices. as in class, the two firms are located at two ends of a line one mile apart. consumers are evenly distributed along the line. the firms have identical marginal cost, $60. firm b produces a product with value $110 to consumers.firm a (located at 0 on the unit line) produces a higher quality product with value $120 to consumers. the cost of travel are directly related to the distance a consumer travels to purchase a good. if a consumerhas to travel a mile to purchase a good, the incur a cost of $20. if they have to travel x fraction of a mile, they incur a cost of $20x. (a) write down the expressions for how much a consumer at location d would value the products sold by firms a and b, if they set prices p_{a} and p_{b} ? (b) based on your expressions in (a), how much will be demanded from each firm if prices p_{a} and p_{b} are set? (c) what are the nash equilibrium prices?