Obesity rates have been rapidly increasing in recent years. This is a problem especially for low-income families and for households without access to quality food. Consequently, fast food restaurants are a solution for many who cannot afford healthy food. The large number and variety of fast food restaurants coupled their aggressive advertisements, cheap prices and large portions, may have an effect on consumption and obesity rates. This study explored the relationship between types of advertisements utilized by fast food restaurants and consumers’ willingness to pay (WTP) to see if bundled advertisements have an impact on WTP. Bundles, also referred to as value meals, combine two or more products, which are sold at a lower price than the individual prices combined. Using a between subjects study, a Becker, DeGroot, Marshak (BDM) bidding auction was conducted to elicit participants WTP for three different items (drink, fries and burger) which were advertised individually or in a bundle. I hypothesized that consumers would be willing to spend more on individually advertised items than the same items advertised in a bundle. I found that consumers were indeed willing to pay significantly more for items sold individually than when in a bundle. These results suggest that consumers see purchasing bundles as a gain rather than a loss, increasing the overall perceived value of the bundle and decreasing the perceived cost.
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