Scenario 17-5 Assume That a Local Bank Sells Two Services, Checking Accounts

question 3

Multiple Choice

Scenario 17-5
Assume that a local bank sells two services, checking accounts and ATM card services. The bank's only two customers are Mr. Donethat and Ms. Beenthere. Mr. Donethat is willing to pay $8 a month for the bank to service his checking account and $2 a month for unlimited use of his ATM card. Ms. Beenthere is willing to pay only $5 for a checking account, but is willing to pay $9 for unlimited use of her ATM card. Assume that the bank can provide each of these services at zero marginal cost.
-Refer to Scenario 17-5.If the bank is able to use tying to price checking account and ATM services,what is the profit-maximizing price to charge for the "tied" good?

• A) $14
• B) $10
• C) $9
• D) $8

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Definitions:

Increasing Latitude

Refers to moving towards the poles (north or south) from the equator, generally associated with changes in climate, biodiversity, and daylight hours.

Permafrost

A layer of soil or rock, below the surface of the earth, that remains frozen for two or more consecutive years, found mostly in polar regions.

Permanently Frozen Ground

Ground that remains at or below 0°C (32°F) for at least two consecutive years, typically found in polar regions, known as permafrost.

Hadal Zone

The Hadal Zone refers to the deepest regions of the ocean, typically found in oceanic trenches, and ranges in depth from about 6,000 to 11,000 meters.