Problem: Soma cable has a educational channel and a music video channel. The viewing audience consists of two segments (A and B). Below shows the segment sizes, their RP's for each channel:
A's RP: Educational: $20 Music Video: $2 Segment Size: 4,000
B's RP: Educational: $11 Music Video: $11 Segment Size: 6,000
SOMA incurs a cost of $5 per channel for each customer.
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1) If it sold each channel separately, what price should it set on each to maximize profits?
2) If it sold the two channels as a bundle, what price should it set on the bundle to maximize profit?
3) Could Soma generate more profit through mixed bundling? If so, which ones and at what price?