Two-part Tariff
entry/usage - consumers charged both an entry fee and a usage fee
- ie. amusement parks, golf course, resorts
- will use entry fee to try to capture as much consumer surplus as possible
- for just 1 consumer, will set usage fee at marginal cost and entry fee to capture all of the consumer surplus
- for more than 1 consumer:
- will set usage fee higher than marginal cost
- will set entry fee to capture all of consumer surplus of consumer w/ the least demand
Subject:
Economics [1]
Subject X2:
Economics [1]