5. (4 points) A local golf course estimates their average customer's demand per year is Q = 70 2P (or P = 35 0.5Q) and knows the marginal cost of each round of golf is $5. If the store decides to engage in optimal two-part pricing strategy, how much should they charge for an annual membership and for each individual round of play, respectively? Show your work.

a. (2 pts) Graph the companys demand and cost and indicate on the graph your answers to the questions above.

b. (4 pts) Suppose there are two types of consumers in the market for suits. Consumers of type A are willing to pay up to $120 for a coat, and up to $50 for pants. Consumers of type B will pay up to $100 for a coat, and $60 for pants. The firm selling suits is unable to tell the two types apart, but knows from demographic surveys that there are twice as many Type As as there are Type Bs. The firm faces no competition. It has already paid for the suits and is now trying to maximize the revenue from selling them.

Is it better for the firm to sell the coat and the pants together as a suit, or separately? Explain your answer (support it with numbers, if possible).