2. Bundling (Adams & Yellen, 1976) A firm is selling good 1 and good 2. Pat wants to purchase at most one of each object, and has valuation v for good 1, v2 for good 2, and v1 + 12 for both. If Pat purchases good & for pa, then Pat receives utility vx - px (and similarly for bundles). The firm has 3 options for selling to Pat: (a) Pure Components Firm sells goods separately at price p, and p2. Pat can choose to either 1) buy only good 1, 2) buy only good 2, and 3) buy both goods. Write out Pat's utility in each option. (b) Pure Bundling Firm sells goods together at price pp. Write out Pat's utility. (c) Mixed Bundling Firm sells goods separately at price p, and p2, and together as a bundle at pp (where pB > p, and 62