In this engaging lab, students will delve into the fundamental concepts of pricing and the pivotal role demand curves play in shaping effective pricing strategies.
Storyline: "You are very lucky to have inherited a small local department store, the Main Street General Store, from your Aunt Clara. The twist? You'll become the official owner of this community treasure only if you can turn an extra profit of $1000 from a Christmas Closeout sale of this year."
Students will find the best discount price of six flagship products of a department store using the given demand curves. They will be presented with two demand curves for every product, one for normal days and one for Christmas days. Students will find the discount price for Christmas that will yield maximum profit.
Students will also design discount posters for every product.
To wrap up the experience, students will reflect on their learnings by writing a letter to a friend, and sharing insights on how to set prices for products in the upcoming year's sale.