You operate the only fast-food restaurant in town, selling burgers and fries. There are only two customers,
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a) If x = 1 and you do not bundle the two products, what are your profit-maximizing prices PB and PF? Calculate total surplus under this outcome.
b) Now assume only that x > 0. Instead, suppose that you hired an economist who tells you that the profit-maximizing bundle price (for a burger and fries) is $8, while if you sold the items individually (and did not offer a bundle) your profit-maximizing price for fries would be greater than $3. Using this information, what is the range of possible values for x?
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