With a two-part tariff,consumers pay:
A)a constant "average" price per unit of output.
B)higher prices for purchasing greater quantities of output.
C)an "average" price per unit of output that declines with the quantity purchased.
D)a flat fee followed by an increasing per unit price.

Question

Quizplus · Accepted Answer

With a two-part tariff, consumers typically pay a flat fee plus a per unit price for each unit of output they purchase. As they buy more units, the average price per unit effectively declines because the fixed fee is spread over a larger number of units, making the average cost per unit decrease.

With a Two-Part Tariff,consumers Pay