Suppose you are the manager of a small, local diner. You have been studying the sales data of your restaurant over the past year. You have managed to identify two groups of consumers who frequent your establishment and have cross-referenced their orders with historical data. You have jotted down the following notes to yourself:

HamburgersOnion RingsGroup 1 Maximum Valuation$4.25$1.25Group 2 Maximum Valuation$3.50$2.50

Currently, you sell your products a la carte (separately on the menu). However, you are wondering whether or not bundling hamburgers and onion rings together might increase your total revenues. (Note: You cannot price discriminate.)

a) If the a la carte price for a hamburger is currently $3.00 and the a la carte price of onion rings is $2.00, how much revenue would you make (assume a typical consumer from each group)? Calculate and show.

b) What bundle price could you set (if any) where the typical consumer from both groups would purchase the package?Is there a bundle price where this can occur that would make revenues higher than selling each product separately at the per unit prices listed in part a)?Why or why not? Given the correct answer here, should you bundle the two products versus selling them separately?