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5. What is the value of the consumer surplus for each group A and B, under this segmentation strategy? 6. Draw the situation described in

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5. What is the value of the consumer surplus for each group A and B, under this segmentation strategy? 6. Draw the situation described in (4) and (5) above, clearly showing each group's profit- maximizing price and quantity, and the areas that correspond to their consumer surpluses. 7. Verify the inverse elasticity rule under each of the scenarios described (1) and (4) above. Question 3 (70 points; 10 points each): Consider an imperfectly competitive service provider, Muscat Automotive Repair Services (MARS), whose total cost of production is C = 300 + 0.165Q2. Also, MARS faces two different market segments, A and B, whose demands can be linearly expressed as QA = 240 - PA and QB = 120 - 0.5P8. (Hint: the marginal cost is the slope of the total cost function)

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