Find a profit maximizing a two part tariff

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Reference no: EM131380410

Using the data in Exercise 1, determine the profit maximizing the quantity discount scheme in which all units up to a point sell for a high price, and all remaining units sell for a low price.
Exercise
You own a small country club. You have three types of customers who value each round of golf they play during a month as shown in the following table:

Round	Segment 1	Segment 2	Segment 3
1	$60	$60	$40
2	$50	$45	$30
3	$40	$30	$20
4	$30	$15	$10
5	$20	$0	$0
6	$10	$0	$0

It costs you $5 in variable costs to provide a customer with a round of golf. Find a profit maximizing a two-part tariff. Each market segment is of equal size.

Reference no: EM131380410

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