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Question: 2 15 points bundling a car dealer in florida once...

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2. (15 points) Bundling. A car dealer in Florida once offered bundles of cars to customers, combining sedans with SUVs. (True story.) Four consumers are interested in a particular sedan and SUV, and the dealers best assessment of their reservation prices, in thousands of dollars, is: Sedan $ 10 thousand $ 8 thousand $ 9 thousand $6 thousand Consumer SUV $ 21 thousand S 22 thousand S 24 thousand $ 30 thousand The dealers cost for the sedan is $7,000, and for the SUV is S22,500. The dealer cant price discriminate in selling the autos, but can bundle them together (8 pts) (a) If the dealer were to price the vehicles individually, what price for each would maximize producers surplus, and what would the resulting producers surplus be? (7 pts) (b) If the dealer bundled the vehicles together, what bundle price would maximize producers surplus, and what would producers surplus be?

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