Bundling Watch

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Report Thread starter 7 years ago
Ok, so i've got a load of industrial economics questions to do for tommorow and i'm stuck on what is supposedly the easiest one

This is the question:

2. Suppose that a monopolist has a market with 100 consumers, each of which has an inverse
demand function equal to P = 15-5Q. The marginal cost is constant and equal to 5.
a) Find the price and profit in the case of uniform pricing.
b) Can the monopolist increase its profits by applying bundling? If yes, what is the optimal
size of the bundle?

Now, part a is very easy but i just don't get part b, I mean how the **** do you bundle when you don't have 2 products???

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