(Table: Maximum Willingness to Pay II) The marginal cost of a one-night stay and one round of golf are $50 and $10, respectively. Which of the following statements is (are) TRUE? Maximum Willingness to Pay One-Night One Round of Stay $180 170 100 Golf Parv Mahika Carina $50 70 80 1. If a firm is using a pure bundling strategy, the bundle price should be set at $230 to maximize producer surplus. II. Suppose a firm uses the following mixed bundling strategy: the bundle price is $240, or the price for a one-night stay is $180 and the price per round of golf is $80. With this strategy, producer surplus is $380. III. If a firm prices each item separately such that the price for a one-night stay is $100 and the price per round of golf is $50, producer surplus will be $270. 1, II, and III Il and II O l and III

(Table: Maximum Willingness to Pay II) The marginal cost of a one-night stay and one round of golf are $50 and $10, respectively. Which of the following statements is (are) TRUE? Maximum Willingness to Pay One-Night One Round of Stay $180 170 100 Golf Parv Mahika Carina $50 70 80 1. If a firm is using a pure bundling strategy, the bundle price should be set at $230 to maximize producer surplus. II. Suppose a firm uses the following mixed bundling strategy: the bundle price is $240, or the price for a one-night stay is $180 and the price per round of golf is $80. With this strategy, producer surplus is $380. III. If a firm prices each item separately such that the price for a one-night stay is $100 and the price per round of golf is $50, producer surplus will be $270. 1, II, and III Il and II O l and III

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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