Which of the following is true of a price discriminating monopolist employing a two-part tariff on consumers having different demands?
A)They earn less profit than the non-price discriminating monopolists.
B)They supply an output which is higher than the non-price discriminating monopoly output.
C)They set a price that is higher than the non- price discriminating monopoly price.
D)They set an entry fee which is more than the total consumer surplus.

Question

Quizplus · Accepted Answer

A two-part tariff allows a price discriminating monopolist to capture more consumer surplus by charging an entry fee and a per-unit price, leading to a higher output compared to a non-price discriminating monopolist.

Which of the Following Is True of a Price Discriminating