Assume that you are to decide whether a third-degree discrimination situation is in society's interest. Assume that under the "no discrimination allowed" case, one group of users (group B) of a new product finds its price to0 high to buy any of the products. But under discrimination, they would buy a positive amount at the lower price offered to them. Further, assume that the price charged to the original group of buyers (group A) remains unchanged after discrimination demand by industry B. is permitted.

a. The legal permission to price discriminate would benefit the monopolist, but the original group of buyers (group A) would be harmed. Do you agree or disagree? Why?

b. The legal permission to discriminate would benefit group B buyers and the monopolist, and group A buyers would be unaffected, so the permission to discriminate is a Pareto superior move compared with the no-discrimination situation. Do you agree or disagree? Why?

c. A Pareto superior move will always pass the "increase in total economic surplus" test, but the reverse is not true. True or false? Why?