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Suppose there are two customers (or types of customers), The table below shows the willingness of each customer to pay for each service or a

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Suppose there are two customers (or types of customers), The table below shows the willingness of each customer to pay for each service or a bundle. Assume the marginal and average costs of selling one more service to a customer are virtually zero (such that the rm attempts to maximize revenue). Explain why the rm does not use mixed bundling. Throughout, if consumers are indifferent between purchases, then assume they make the purchase that benets the rm. First, let consumer valuations be positvely correlated. Internet Television Bundle Consumer 1 $120 $100 $220 Consumer 2 $110 $40 $150 Prot-maximizing price $110 100 $150 Prot from selling the goods at separate prices is \"separate = $ 1 prot from selling the goods at the bundled price is "bundled = 3 , and prot from selling the goods at the prot-maximizing separate prices and at the prot-maximizing bundled price is \"mixed = $ . (Enternumen'c responses using integers.) Now consider an example where consumer valuations are negatively correlated. Why doesn't the rm use mixed bundling? Internet Television Bundle Consumer 1 $120 $70 $190 Consumer 2 $70 $120 $190 Profitmaximizing price $70 $70 $190 Profit from selling the goods at separate prices is "separate = $ prot from selling the goods at the bundled price is "bundled = 3D: and prot from selling the goods either at the profit-maximizing separate prices or at the prot-maximizing bundled price is \"mixed = $

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