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Suppose you run a resort just outside of Mesquite, Nevada. The following table represents the maximum willingness to pay for one night stay and one round of golf for David and John. Assume the marginal cost of a one night stay is $20 and $0 for a round of golf.
David
John
One night stay:
$50
$110
One round of golf:
$80
$35
1) If you set prices for lodging and golf individually, you will charge $ ? for one night stay $ ? for one round of golf, and earn a profit of $?.
2) If instead you bundle a one-night stay with a round of golf, you will charge $ ? for the bundle and earn a profit of $?
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