Question: Some golf clubs charge an up-front fee to join and a per-game charge for their members. Others do not charge a membership fee but charge a higher per-game fee for services. Consider clubs in two different locations. One is located in a suburban area where the residents tend to be of similar age, income, and occupation. The other is in the city with a more diverse population.

a. Which of the locations is more likely to charge a membership fee?

b. Suppose for the suburban club, each one of their customers has a demand for golf games represented by P = 100-3Q. The marginal cost of providing service for one game is $10. Devise a two-part tariff pricing strategy that will exhaust all consumer surpluses.