Use the following to answer questions: Table: Maximum Willingness to Pay for Word and Excel $$\begin{array} { l c c }
\hline & \text { Amanda } & \text { Yvonne } \
\hline \text { Word } & \$ 110 & \$ 60 \
\text { Excel } & \$ 40 & \$ 100 \
\text { Office (Word + Excel) } & \$ 150 & \$ 160 \
\hline
\end{array}$$
-(Table: Maximum Willingness to Pay for Word and Excel) Refer to the table. If Microsoft bundles Word and Excel and sells them as Office, what is the maximum profit Microsoft can make from selling Office? (Assume the marginal costs of production are zero.)

Question

Use the following to answer questions: Table: Maximum Willingness to Pay for Word and Excel $$\begin{array} { l c c } 
\hline & \text { Amanda } & \text { Yvonne } \
\hline \text { Word } & \$ 110 & \$ 60 \
\text { Excel } & \$ 40 & \$ 100 \
\text { Office (Word + Excel) } & \$ 150 & \$ 160 \
\hline
\end{array}$$
-(Table: Maximum Willingness to Pay for Word and Excel) Refer to the table. If Microsoft bundles Word and Excel and sells them as Office, what is the maximum profit Microsoft can make from selling Office? (Assume the marginal costs of production are zero.)

Quizplus · Accepted Answer

The maximum profit is $300, which is the sum of the maximum willingness to pay for Office by Amanda ($150) and Yvonne ($160).

Use the Following to Answer Questions: Table: Maximum Willingness to Pay