Technophile and one person from general public

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Suppose that a technophile is willing to pay $800.00 now for a new iPhone 11, but is only willing to pay $400.00 if he/she has to to wait a year to buy it. Rest of the general public is willing to $500.00 for a new iPhone 11 whether he/she buys it now or after one year. There are only two time periods and the marginal cost of an iPhone 11 is $250.00. Assume that there are equal number of technophiles and general people. Ignore the time value of money and answer the question as if there is one technophile and one person from the general public.

  • If the iPhone is priced at $800.00 for today and at $500.00 for sale one year from today, who will buy it?
  • If the iPhone is priced today at $800.00, how much will be the profit?
  • If the iPhone is priced at $800.00 for today and at $500.00 for sale one year from today, how much will be the profit?

Reference no: EM132559370

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