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(30 Marks)
a)Management of GENADE Travel and Tour has identified two groups of
individuals that would be interested in the vacation package consisting of room and
board and/or entertainment. The maximum amount that group 1 is willing to pay
for room and board is GHC 2500 and for entertainment is GHC 500. For
group 2,
the maximum amount they are willing to pay for room and board is GHC 1800 and
for entertainment is GHC 750. Although GENADE Travel and Tour is not able to
identify members of either group, it does know that each group values the
components of the package differently. Assuming there are an equal number of
members in each group and that the total membership in each group is a single
individual. If the marginal cost of providing the service. (room and board and/or
entertainment) to each group is GHC 1000.

Sagot :

khuranashilpa76

The marginal cost of providing the service, For room and board GHC = 1800 And For entertainment GHC500.

If the management is not able to identify the group of customers, it should charge the minimum price customers are willing to pay as it does not lead to losing a market share and helps to compete in the market without identifying the group of customers.  But this strategy is suitable only if the management is able to recover its marginal cost.

The maximum price for room and board = GHC 2500

The maximum price for entertainment = GHC 750

The minimum price for room and board = GHC 1800

The minimum price for entertainment = GHC500

Marginal cost = GHC1000

The minimum price customers are willing to pay = is GHC(1800 + 500).

Thus, The marginal cost of providing the service

For room and board GHC = 1800

And For entertainment GHC500

Learn more about the marginal cost here:-https://brainly.com/question/11689872

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