6-3. Pricing ATM Machines A bank in a medium-sized midwestern city, Firm X, currently charges $1 per transaction at its ATMs. To determine whether to raise price, the bank managers experimented with a number of higher prices (in 25-cent increments) at selected ATMs. The marginal cost of an ATM transaction is $0.50.

What ATM fee should the bank charge?

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ATM Fee Usage $2.00 1,000 $1.75 1,500 $1.50 2,000 $1.25 2,500 $1.00 3,000