Price Discrimination in a Software Market

Instruction: How can a software company effectively implement price discrimination to maximize revenue without alienating customers?

Context: This question explores the candidate's ability to design and implement a price discrimination strategy that captures consumer surplus while maintaining customer satisfaction and loyalty.

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Economically, price discrimination involves charging different effective prices for comparable offerings based on willingness to pay rather than only cost differences. Software feature tiers also change what is sold; differences in features and support costs should not be confused with a pure same-product price comparison.

I would prefer understandable self-selection: a limited individual plan, a team package with specified benefits,...

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