When Will Setting a Relatively High Entry Fee and a Low

question 57

Multiple Choice

When will setting a relatively high entry fee and a low competitive price be the best strategy for a two-part tariff monopolist?

• A) When the customers are nearly identical.
• B) When the customers have inelastic demand for the product.
• C) When the customers place a relatively low value on their time.
• D) When the customers can be separated into a number of diverse groups.

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