2. Natural Monopolies and Pricing Consider a natural monopoly with total costs given by TC = 800 + 40. Market demand is Q = 160 4P. a. If price is set to marginal cost, what are the monopolist's output and prots? What is consumer surplus? b. If price equals average cost, what are the monopolist's output and prots? What is the consumer surplus? c. There is now two-part pricing. The monopolist sets price equal to the marginal cost and charges a xed fee per customer. Assume that demand comes from 8 identical consumers. What participation fee would a prot-maximizing monopolist set? (1. What is the participation fee if the regulator sets prices to maximize consumer surplus with the monopolist breaking even