m I removed a citation to the American Medical Association Manual of Style because it has literally nothing to do with this article. The word "A" doesn't need a citation. LOL.
A<ref>{{Cite journal|last=Iverson|first=Cheryl|date=2009-04-01|title=Software Manual or Guide|journal=AMA Manual of Style|doi=10.1093/jama/9780195176339.022.97}}</ref> '''two-part tariff''' (TPT) is a form of [[price discrimination]] wherein the price of a [[product (business)|product]] or [[Service (economics)|service]] is composed of two parts – a lump-sum fee as well as a per-unit charge.<ref>Palgrave Dictionary of Economics: http://www.dictionaryofeconomics.com/article?id=pde2011_T000188 {{Webarchive|url=https://web.archive.org/web/20171214014411/http://www.dictionaryofeconomics.com/article?id=pde2011_T000188 |date=2017-12-14 }}</ref><ref>Robert S. Pindyck and Daniel L. Rubinfeld: ''Microeconomics'', 8th edition, Pearson, 2013, p. 414.</ref> In general, such a pricing technique only occurs in partially or fully [[monopoly|monopolistic]] [[market (economics)|market]]s. It is designed to enable the firm to capture more [[consumer surplus]] than it otherwise would in a non-discriminating pricing environment. Two-part tariffs may also exist in [[Competition (economics)|competitive markets]] when consumers are uncertain about their ultimate demand. Health club consumers, for example, may be uncertain about their level of future commitment to an exercise regimen. Two-part tariffs are easy to implement when connection or entrance fees (first part) can be charged along with a price per unit consumed (second part).<ref>{{Cite book|last=Phillips|first=L|title=Palgrave Macmillan (eds) The New Palgrave Dictionary of Economics|publisher=Palgrave Macmillan|year=1987|isbn=978-1-349-95121-5|___location=London}}</ref>
Depending on the homogeneity of demand, the lump-sum fee charged varies, but the rational firm will set the per unit charge '''above or equal to''' the [[marginal cost]] of production, and '''below or equal to''' the price the firm would charge in a [[Monopoly#Monopolistic pricing|perfect monopoly]]. Under [[Competition (economics)|competition]] the per-unit price is set below marginal cost.<ref>Hayes, B. (1987), p. 42.</ref>
