6. Individual Problems 14-6 At a student café, there are equal numbers of two types of customers with the following values. The café owner cannot distinguish between the two types of students because many students without early classes arrive early anyway (1.e., she cannot price-discriminate). Coffee Banana Students with Early Classes Students without Early Classes 67 57 46 96 The marginal cost of coffee is 5 and the marginal cost of a banana is 20. The café owner is considering three pricing strategies: 1. Mixed bundling: Price bundle of coffee and a banana for 153, or just a coffee for 67. 2. Price separately: Offer coffee at 57, price a banana at 96. 3. Bundle only: Coffee and a banana for 113. Do not offer goods separately.

6. Individual Problems 14-6 At a student café, there are equal numbers of two types of customers with the following values. The café owner cannot distinguish between the two types of students because many students without early classes arrive early anyway (1.e., she cannot price-discriminate). Coffee Banana Students with Early Classes Students without Early Classes 67 57 46 96 The marginal cost of coffee is 5 and the marginal cost of a banana is 20. The café owner is considering three pricing strategies: 1. Mixed bundling: Price bundle of coffee and a banana for 153, or just a coffee for 67. 2. Price separately: Offer coffee at 57, price a banana at 96. 3. Bundle only: Coffee and a banana for 113. Do not offer goods separately.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter13: Monopoly And Antitrust

Section: Chapter Questions

Problem 13P

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