What comprising both an order of chicken and of biscuits

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Reference no: EM1365402

Suppose there are three types of customers who frequent Louisiana Fried Chicken (LFC), a fast food chain that sells chicken and biscuits. (For simplicity, assume an equal number of each type of customer) These customers have the following valuations ("reservation prices") for chicken and biscuits:

Consumer Chicken Biscuits
1 $12 $1
2 $10 $3
3 $9 $4

Suppose the fully allocated cost of making an order of chicken is $6 and the fully allocated cost of making an order of biscuits is $2.50.

If LFC sells chicken and biscuits as a meal deal, what price would be set for the meal deal which includes both an order of chicken and an order of biscuits?

a. $13
b. $14
c. $15
d. $16

Reference no: EM1365402

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