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    Two part pricing strategy for a store

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    A store estimates their average customer's demand per year is Q = 20 - 4P, and knows the marginal cost of each rental is $1.00. How much should the store charge for an annual membership in order to extract the entire consumer surplus via an optimal two-part pricing strategy?
    A. $20
    B. $32
    C. $40
    D. $64

    Please show calculations

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    https://brainmass.com/economics/cost-benefit-analysis/two-part-pricing-strategy-194861

    Solution Summary

    A two part pricing strategy is featured.

    $2.19