I appreciate your help
We've seen that if consumers are identical, then a rm using two-part pricing with access fee F and per-unit price p generally nds it prot-maximizing to set the socially efcient price p* at which price equals marginal cost. However, if consumers differ (as in the textbook's example on page 429), setting a price above marginal cost may be optimal. Let's explore how general that result is. Suppose there are two consumers and the rm must make the same two-part o'er (F, p) to both. Both consumers have \"box-shaped\" demand. (This isn't critical to the results, but it simplies things.) Consumer 1 has a reservation value of m = 4 for up to Q1 = 2 units, and no value for additional units. (So her demand curve is horizontal at p = r1 out to q = ('11, then drops to 0.) Consumer 2 has a reservation value of r2 = 5 for up to E}; = 1 units, and no value for additional units. The rm has a constant marginal cost m = 2. a. Suppose the rm offers a deal (F, p) with p = m. Sketch the consumers' demand in this situation and determine the consumer surplus earned by each consumer. What is the greatest access fee F the rm could charge, and what is its overall prot? b. Now suppose the rm sets p = 3 > m. Find the prot-maximizing access fee in this case and determine the rm's overall prot. Use a diagram to illustrate the change for each consumer, relative to the best possible prot in part (a), in the rm's prot from per-unit sales, prot om the access fee, and overall prot on that consumer. Provide intuition for why the rm is better or worse off pricing above marginal cost. c. For the remainder of the question, suppose that r1 = 3; all other parameters remain the same. If the rm offers the best possible deal with p = m, what is its prot now? d. Suppose the rm sets p = 1