Located centrally in a university town is UrbanWorkSpace, a co-working space catering to both students and professionals (non-students). Operating the space incurs a daily overhead of $500, which covers utilities, amenities, staff salaries, and maintenance. The demand dynamics for the coworking space are as follows:

Students: = 210 3, where is the number of day-passes purchased by students at price .

Non-students: = 160 2, where is the number of day-passes purchased by non-students at price .

a) If UrbanWorkSpace employs a uniform strategy, , what is the inverse aggregate demand curve for coworking space? (Hint: Consider reservation prices for coworking space). b) What is the profit-maximizing number of passes the firm will sell if it charges one price to everybody? How many passes would it sell to each type of user? What would its profits be?

Suppose UrbanWorkSpace could precisely differentiate between students and non-students by requiring that students present their student IDs (assume that there are no fake student IDs available for non-students and that there is no reselling of day-passes).

c) Compare UrbanWorkSpace's profit under third degree price discrimination with profit under uniform pricing. Would the firm prefer to price discriminate? d) If a resale market for day-passes develops, explain how this would impact UrbanWorkSpace's ability to engage in price discrimination