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Deep Clean, Inc., provides deep cleaning services for retail locations that have been exposed to virus-infected individuals. They have three types of potential customers: Type
Deep Clean, Inc., provides deep cleaning services for retail locations that have been exposed to virus-infected individuals. They have three types of potential customers: Type 1: Businesses serving individuals who are not at risk and that can maintain 6-foot distance Type 2: Businesses serving individuals who are not at risk, but that cannot maintain 6-foot distance Type 3: Businesses serving at-risk individuals Deep Clean's services come in three distinct versions: " Basic" : surface-level cleaning with normal cleaners " Intense" : surface-level cleaning with medical-grade cleaners " Extreme" : deep cleaning with medical-grade cleaners For the purposes of these questions, assume that Deep Clean's costs are zero. The marginal willingness to pay for the different customer types is given in the following table: Basic Upgrade to Upgrade to Intense Extreme Group Sizes Type 3 50 25 20 5 Type 2 40 10 5 6 Type 1 20 5 0 16. Suppose that due to regulatory changes, Deep Clean can no longer offer its " Basic" product. Thus, the table of the previous questions becomes: Intense Upgrade to Group Sizes Extreme Type 3 75 20 5 Type 2 50 5 Type 1 25 0 For this new scenario, consider the following statements: . The seller's revenue under the revenue maximizing menu is $650. . Total consumer surplus for Type 2 consumers is $60. . Total consumer surplus for Type 3 consumers is $125. . The maximum total surplus possible when " Basic" is not a possibility is $980. . The total deadweight loss generated by the revenue maximizing menu is $205 How many of the above statements are correct? A. Exactly 1 or 2 of the statements are correct B. Exactly 3 of the statements are correct C. Exactly 4 of the statements are correct D. Exactly 5 of the statements are correct E. None of the other choices is correct
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