A monopolist faces a market split evenly between high valuation consumers with individual inverse demand PH = 20 yH and low valuation consumers with individual inverse demand PL = 16 2yL For convenience, suppose the firm has a marginal cost equal to zero. Moreover, arbitrage is not possible.

Assume the firm cannot observe group status (i.e., cannot identify if a customer has a high or low valuation). Determine the firm's best second-degree pricing scheme. Show this outcome on a graph and explain why your answer is the best strategy for the firm