Compadres restaurant decided to introduce an all-you-can-eat…

Compadres restaurant decided to introduce an all-you-can-eat buffet on Tuesdays and Wednesdays to increase business. They found that they acquired a whole new set of customers, most of whom were very big eaters. After a time, they increased the price of the buffet. Compadres suffered from the problem of:

Big Waves is a large water park. Suppose the individual dema…

Big Waves is a large water park. Suppose the individual demand for entrance into Big Waves is Qd = 50 – (2 × P) and each consumer has the same demand. Big Waves has a constant marginal cost of $5 per consumer. If Big Waves practices two-part pricing and requires a membership fee and then a separate entrance fee, what is the profit-maximizing membership fee?