Assume a movie distributer in Vienna knows the reservation prices of two exhibitors. One exhibitor owns an art-house cinema De France, and the other owns CinePlexx, cinema which shows popular movies. The reservation prices each exhibitor is willing to pay for two movies, The Death of Stalin and Black Panther, are:

Exhibitor: BP DoS De France: 3 800 4 000 CinePlexx: 6 300 2 500

For each sale that the distributor makes of Black Panther, he has to pay an upstream firm 900 euros. For The Death of Stalin, he owes the upstream distributors 500 euros for each sold movie.

a. What is the maximum profit that the distributor can make if he sells the movies as a bundle (pure bundling)?

b. What is the maximum profit that the distributor can achieve if he sells the movies separately?