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A video rental store has estimated that the inverse demand
equation for video rentals by a typical customer is P = 6.50 –
0.5Q. The marginal cost of each rental is $2.50. If the video
rental store engages in two-part pricing, how much profit can the
video rental store expect to earn from each customer?

a.

$2.50

b.

$48

c.

$12

d.

$6.50

e.

$16