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Suppose tennis players have identical demand functions for playing at a local tennis club given by , where Q is the number of hours played
Suppose tennis players have identical demand functions for playing at a local tennis club given by , where Q is the number of hours played and P is the price per hour played. The tennis club incurs a $30 marginal cost for each hour played. If the tennisclub uses two-part pricing, what price should it charge for annual membership and what price should it charge per hour played?
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