Suppose Two Types of Consumers Buy Suits

question 124

Multiple Choice

Suppose two types of consumers buy suits.Consumers of type A will pay $100 for a coat and $50 for pants.Consumers of type B will pay $75 for a coat and $75 for pants.The firm selling suits faces no competition and has a marginal cost of zero.If the firm can identify each consumer type and can price discriminate,what is the optimal price for a pair of pants?

• A) Charge both types $150.
• B) Charge both types $75.
• C) Charge type A consumers $50, and type B consumers $75.
• D) Charge type A consumers $50, and type B consumers $50.