1. Suppose a firm called, Bananarama, that has a monopoly on fresh baked banana bread in Saint John. Assume Jan's marginal willingness to pay for Bananarama's banana bread is described by the following table and the marginal costs for producing banana bread is 0 (so maximizing revenues maximizes profits):

a. Suppose Bananarama is charging its revenue maximizing single price of $8. What is Bananarama's revenue at this price?

b. What is Jan's consumer surplus? (hint: think about the definition of consumer surplus)

c. In one to two sentences, how can Bananarama institute a form of second-degree price discrimination to increase its revenues? Describe the type of price discrimination, how Bananarama could implement it, and the impact on Jan's consumer surplus

d. [bonus 0.2] Suppose Bananarama decides to offer a quantity discount for quantities of 2 or more (i.e. the price for the first banana bread will be different than the price charged for all of the next banana breads). What are the two prices Bananarama should charge to maximize revenues/profits?

i. How much revenue does Bananarama make using the quantity discount?

ii. What is Jan's new consumer surplus?

Quantity	Marginal Willingness to Pay ($)
1	15
2	10
3	8
4	3
5	1