A firm has estimated that the demand for its product comes from two types of customers, type I and type II. Each type I customer - there are 30 of them - has a demand curve given by Q = 20 - P , while each type II customer - there are 50 of them - has a demand curve given by Q = 15 - P . The firm\'s marginal cost is constant and equal to $5. Suppose the firm wants to use a two-part pricing strategy ( T; P ), and it has decided to set P = $5 (we know this need not be optimal, but this is what the firm has decided to set). With P = $5, the profit-maximizing T is T = $50 T = $112.5 T = $75 None of the Above Solution T=$50 .

1. A firm has estimated that the demand for its product comes from two types of customers, type I
and type II. Each type I customer - there are 30 of them - has a demand curve given by Q = 20 -
P , while each type II customer - there are 50 of them - has a demand curve given by Q = 15 - P
. The firm's marginal cost is constant and equal to $5. Suppose the firm wants to use a two-part
pricing strategy ( T; P ), and it has decided to set P = $5 (we know this need not be optimal, but
this is what the firm has decided to set). With P = $5, the profit-maximizing T is
T = $50
T = $112.5
T = $75
None of the Above
T = $50
T = $112.5
T = $75
None of the Above
Solution
T=$50