When eating as a group in a restaurant it is common practice in Germany that everyone pays his/her own bill. On the other hand, in many other countries it is common practice to split the bill equally within the group.

Compare the outcome under this check-splitting arrangement with the outcome when each diner pays for his own order. Compare, in particular, the restaurant's profit in each case and the diners' welfare in each case. Is there an alternative arrangement that will make the diners better off than in either of these arrangements?