=+B. Suppose you manage a superstore and you are currently charging an annual membership fee of $50.

Since x2 is denominated in dollar units, p2 5 1. Suppose that p1 5 1 for those shopping outside the superstore, but your store sells x1 at 0.95. Your statisticians have estimated that your consumers have tastes that can be summarized by the utility function u(x1

, x2

) 5 x1 0.15x2 0.85

.