Multiple Choice
The average consumer at a firm with market power has an inverse demand function of P = 10 − Q.The firm's cost function is C = 2Q.If the firm engages in two-part pricing,what is the optimal fixed fee to charge each consumer?
A) $2
B) $32
C) $64
D) None of the answers are correct.
Correct Answer:
Verified
Correct Answer:
Verified
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