Please solve part E and Part F only please don't copy paste please

2. [35 points) Mictel Corporation has a world monopoly on the production of personal computers. It can make two kinds of computers: low end and high end. Onc-fifth of the potential buyers are casual users, and the rest are intensive users. The costs of production of the two kinds of machines as well as the benefits gained from the two, by the two types of prospective buyers, are given in the following table (all figures are in thousands of dollars): Benefit for User Type Cost Causal Intensive PC 4 5 Low-end 1 Type lligh-end 3 6 9 Each type of buyer calculates the net payoff (benefit minus price) that he would get from each type of machine and buys the type that would give the higher net payoff, provided that this payoff is nonnegative. If both types give equal, nonnegative net payoffs for a buyer, he goes for the high end; if both types have negative net payoff for a buyer, he does not purchase. Mictel wants to maximize its expected profit. CTWO lowing (a) If Mict I were his, the company could offer to ell him astoype of mat......stad Icen a tak c-or-lcave-it basis. Wit macl ne vould Mictel offer, ad what rice, to what buyer? n fact, Miel do not know the type of particy aryer. It just makes its atapg available fall buy rs to choose from. (b) First suppose the ompany proluce just the lo-end machines and ells iem for rice p. What val of pr. vill m ximize i profit? Why? Nit, suppose Mictel prodo just the righ- oachines and sells em orrice T. While of Pu will fize it ofit? ? (d) nay, suppose the company produces poth types of mac... collinow-end land ones price ph. Wh incentive-ompatibility constraints on and ph must the com satisfy It wants the casual users to buy the low-end machines and the intensive users to vyo.. high-end machines? (e) What participation constraints must Prand Pa satisfy for the casual users to be willing to buy the low-end machines and for the intensive users to be willing to buy the high-end machines? (1) What values of PL and ph will maximize the expected profit when the company sells both types of machines? What is the company's expected profit from this policy? 2. [35 points) Mictel Corporation has a world monopoly on the production of personal computers. It can make two kinds of computers: low end and high end. Onc-fifth of the potential buyers are casual users, and the rest are intensive users. The costs of production of the two kinds of machines as well as the benefits gained from the two, by the two types of prospective buyers, are given in the following table (all figures are in thousands of dollars): Benefit for User Type Cost Causal Intensive PC 4 5 Low-end 1 Type lligh-end 3 6 9 Each type of buyer calculates the net payoff (benefit minus price) that he would get from each type of machine and buys the type that would give the higher net payoff, provided that this payoff is nonnegative. If both types give equal, nonnegative net payoffs for a buyer, he goes for the high end; if both types have negative net payoff for a buyer, he does not purchase. Mictel wants to maximize its expected profit. CTWO lowing (a) If Mict I were his, the company could offer to ell him astoype of mat......stad Icen a tak c-or-lcave-it basis. Wit macl ne vould Mictel offer, ad what rice, to what buyer? n fact, Miel do not know the type of particy aryer. It just makes its atapg available fall buy rs to choose from. (b) First suppose the ompany proluce just the lo-end machines and ells iem for rice p. What val of pr. vill m ximize i profit? Why? Nit, suppose Mictel prodo just the righ- oachines and sells em orrice T. While of Pu will fize it ofit? ? (d) nay, suppose the company produces poth types of mac... collinow-end land ones price ph. Wh incentive-ompatibility constraints on and ph must the com satisfy It wants the casual users to buy the low-end machines and the intensive users to vyo.. high-end machines? (e) What participation constraints must Prand Pa satisfy for the casual users to be willing to buy the low-end machines and for the intensive users to be willing to buy the high-end machines? (1) What values of PL and ph will maximize the expected profit when the company sells both types of machines? What is the company's expected profit from this policy