True/False/Uncertain a) Higher marginal cost (higher level, but always constant), lower fixed part in the Two-Part Tariff. JUSTIFY b) If a company applies a two-part tariff, it is better to invest in advertising, because only fixed part of two-part tariff increases. JUSTIFY c) The greater the consumer's willingness to pay, the more convenient is the two-part tariff. JUSTIFY d) If the fixed part is equal to the variable part, in a two-part tariff, it implies that the firm is in perfect competition. JUSTIFY
COURSE:
True/False/Uncertain
a) Higher marginal cost (higher level, but always constant), lower fixed part in the Two-Part Tariff. JUSTIFY
b) If a company applies a two-part tariff, it is better to invest in advertising, because only fixed part of two-part tariff increases. JUSTIFY
c) The greater the consumer's willingness to pay, the more convenient is the two-part tariff. JUSTIFY
d) If the fixed part is equal to the variable part, in a two-part tariff, it implies that the firm is in
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For question a) my professor says it's TRUE but I don't have an explanation, must a graphic is necessary
For question b) my professor says it's FALSE, due both variable and fix tariff increase. Please check it.
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