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Which of the following is an example of two-part pricing? In order to buy a cell

ID: 1244461 • Letter: W

Question

Which of the following is an example of two-part pricing? In order to buy a cell phone, you must buy a package that contains other features, such as voice mail and text messaging. A firm, e.g., Sam's Club or Costco, charges a membership fee that is separate from the price paid for items purchased from the firm. You pay full price for the first pair of shoes and half price for the second pair. Tickets for matinees are less expensive than tickets for evening performances when demand is higher. I believe the correct answer is cell phones. Do you agree?

Explanation / Answer

A firm, e.g., Sam's Club or Costco, charges a membership fee that is separate from the price paid for items purchased from the firm.

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