Consider a monopoly chemical manufacturer that has two representative consumers with the demands P = 160 -
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Question:
Consider a monopoly chemical manufacturer that has two representative consumers with the demands P = 160 - Q (for Consumer A) and P = 100 - Q (for Consumer B). The firm's marginal cost is $20 per visit. If the firm practices first-degree two-part pricing, what will be the lump-sum fees charged to each consumer type?
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