Alison Bob Television $20 $12 A. $12, $18 B. $12, $24 C. $20, $18 D. $20, $24 Internet $18 $24 Assume a company can offer customers cable television and internet service at a marginal and average cost of $10. Also assume the company does not price discriminate. The following table shows each customer's marginal willingness to pay for television, internet services, and for a bundle containing both. If the company sells the products separately, which strategy yields the maximum profit? Charge for television and for internet.

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Alison
Bob
Television
$20
$12
A.
$12, $18
B. $12, $24
C. $20, $18
D. $20, $24
Internet
$18
$24
Assume a company can offer customers cable television and
internet service at a marginal and average cost of $10. Also
assume the company does not price discriminate. The
following table shows each customer's marginal willingness to
pay for television, internet services, and for a bundle
containing both. If the company sells the products separately,
which strategy yields the maximum profit? Charge for
television and
for internet.
Transcribed Image Text:Alison Bob Television $20 $12 A. $12, $18 B. $12, $24 C. $20, $18 D. $20, $24 Internet $18 $24 Assume a company can offer customers cable television and internet service at a marginal and average cost of $10. Also assume the company does not price discriminate. The following table shows each customer's marginal willingness to pay for television, internet services, and for a bundle containing both. If the company sells the products separately, which strategy yields the maximum profit? Charge for television and for internet.
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