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Explain why the transfer price that SF Bay has put in place distorts the consultants' usage decision away from total value maximization. If you wanted
Explain why the transfer price that SF Bay has put in place distorts the consultants' usage decision away from total value maximization. If you wanted to make sure that the consultants' usage decisions maximize total value, what would the usage fee have to be? Notice that you may want to set a different usage fee during peak periods, during which the consultants' demand for time on the C10 exceeds capacity, than during non-peak periods, during which every consultant who would want to use the C10 could do so. Explain why these "optimal" usage fees lead to more efficient use of the C10 by the consultants and comment on how you would implement such an optimal usage fee system
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