Figure 16-6 Watanabe Sensei Operates the Only Martial Arts School in Hartfield

question 96

Multiple Choice

Figure 16-6

Watanabe Sensei operates the only martial arts school in Hartfield. For simplicity, assume that consumers have identical demand curves and that Sensei knows what this demand curve is. Figure 16-6 shows this demand curve.
-Refer to Figure 16-6.Sensei's friend, Marcel, suggests that he charge a one-time membership fee to use the martial arts school, in addition to a per-class charge.Suppose Sensei charges the monopoly price for each class and also imposes a one-time membership fee.What is the maximum amount of revenue from the membership fee he can collect from all his customers?

• A)an amount equal to the area A + B
• B)an amount equal to the area E + F
• C)an amount equal to the area H + G
• D)an amount equal to the area A + C + H

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Definitions:

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