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You operate a Caribbean destination resort. You currently offer plans for a cruise departing from the resort and plans for a casino stay. It is

You operate a Caribbean destination resort. You currently offer plans for a cruise departing from the resort and plans for a casino stay. It is expected that in 2021 there will be some return to more normal travel. You will re-launch your advertising for 2021 announcing that customers will be able to do both for one price. Your marginal cost per customer across both tours is $4800.

Customer Preferences

Cruise Casino

Customer1

$7,000 $3,000

Customer2

$2,000 $6,000

Given the preferences, would bundling improve profits over the high-price strategy?Support your conclusion by showing if (by how much) profits differ under each strategy, bundle versushigh price.

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