Illustrate what is the highest amount

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Suppose that the monopolist uses a "two-part tari " where a consumer must pay a lump sum k in order to be able to buy anything at all. A person who has paid k can buy as much as he likes at a price of p per unit purchased. Consumers are not able to resell good 1. For p < 4, illustrate what is the highest amount k that a type A is willing to pay for the privilege of buying at price p?

Reference no: EM1355451

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