Suppose All Individuals Are Identical,and Their Monthly Demand for Internet

question 105

Multiple Choice

Suppose all individuals are identical,and their monthly demand for Internet access from a certain leading provider can be represented as p = 5 - (1/2) q where p is price in $ per hour and q is hours per month.The firm faces a constant marginal cost of $1.Profit-maximizing two-part pricing yields total revenue of

• A) $24.
• B) $40.
• C) $16.
• D) $32.