Problem

The costs of producing product A, product B, or products A and B bundled together are $5...

The costs of producing product A, product B, or products A and B bundled together are $50, $90, and $140, respectively. The file P08_28.xlsx lists the sizes of the three market segments for these products and how much each of the segments is willing to pay for A alone, B alone, or the bundle. Under the assumptions that a market segment will buy the product combination that yields the maximum nonnegative surplus (value minus cost), and a segment will buy no product if no product has a nonnegative surplus, determine an optimal set of product prices. Should the company offer all products for sale?

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