Explain and graphically illustrate how a two-part pricing strategy works when consumers all have identical demand characteristics. Clearly label on your graph the access fee, user fee, and the profits that the seller receives. What is true about the user fee relative to marginal cost?
Explain and graphically illustrate how a two-part pricing strategy works when you have two different types of consumers; a high demand consumer and a low demand consumer. Clearly label on your graph the access fee, user fee, and the profits that the seller receives. What is true about the user fee relative to marginal cost? Compare your answer to part a.