What is linear pricing?

What is nonlinear pricing?

What is bundling, and how can it increase profitability?

How can I find a profit-maximizing nonlinear pricing plan?

**What is linear pricing?**

In Chapter 71, and Chapter 72, I showed how to determine a profit-maximizing price for a product. We made the implicit assumption, however, that no matter how many units a customer purchases, the customer is charged the same amount per unit. This model is known as

*linear pricing*because the cost of buying*x*units is a straight line function of*x (cost of x units=(unit price)*x)*. We will see in this chapter that*nonlinear pricing*can often greatly increase a company’s profit.

**What is nonlinear pricing?**

A

*nonlinear pricing*scheme simply ...

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