a firm has two customers and creates a two part tariff with a usage fee (P)...
Homework Answers
Ans: (b) 1.
Explanation: Since entry fee is more than CS1 (which is consumer surplus of customer 1), customer 1 will be at loss in participating in market.
Net payoff to customer 1 on participating = CS1 - CS2 < 0.
Only customer 2 will participate.
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a firm has two customers and creates a two part tariff with a
usage fee (P)...
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