Suppose you have two types of customers. Type 1 customers typically purchases your firm's product in bundles of 100 units, while type 2 customers typically purchase less than10 units. The cost of producing one unit is $1 plus packaging costs. Packaging costs $1 per unit for small orders, but only $10 for a bundle of 100 units. Finally, suppose type 1 buyers have a price elasticity of demand equal to -2, while type 2 buyers have an elasticity equal to -1.25.

a. What is themarginal cost of selling 100 units to a Type 1 buyer?

b.What is the marginal cost of selling 100 units to Type 2 buyers?

c.What is the profit maximizing price for sales to Type 1 buyers?

d.What is the profit maximizing price for sales to Type 2 buyers?