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Luna Supplies Offers to Lease a Plotter on a 12-Month

Question 18

Essay

Luna Supplies offers to lease a plotter on a 12-month contract for a basic rental of $500 per month plus a fee of $10 per A1-sized plot. (a) Explain this pricing strategy as a two-part price. (b) Consider a customer who prints 50 plots a month. What is their average and marginal cost per plot?

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(a) The fixed payment is $500 ...

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