Q. The husband of Miss Young is a monopolist with constant marginal costs of $50 that can sell to three groups of potential consumers including demands Q1=800-0.2p, Q2=400-p and Q3=700-0.4p respectively.
(i) Find out the optimal price-quantity if the firm is not able to price discriminate.
(ii) Find out the optimal price-quantity if the firm can price discriminate but cannot charge a two part tariff.
(iii) Now assume that it is possible to distinguish consumer types one and two and there are no consumers of type three and the firm can charge a two part tariff. Illustrate what would the optimal pricing strategy look like?