Suppose the firm notices that consumers tend to buy both Good A and Good B. As a result, the firm considers practicing bundling. The information below shows the maximum price each consumer (Consumer 1 and Consumer 2) is willing to pay for each individual good.

Consumer 1:

The maximum price for Good A = $400

The maximum price for Good B = $250

Consumer 2:

The maximum price for Good A = $600

The maximum price for Good B = $100

1.1 What is the maximum amount of revenue that the firm can generate if it sells Good A and Good B separately (without bundling)?

1.2 Calculate the profit-maximizing bundling price.

1.3 Calculate the total revenue that the optimal bundled price will generate for the firm?