3. You are an internet service provider and you have two types of customers, households and businesses. Business demand for your service is qb = 6500 – 100p, and household demand is q, = 12500 – 500p....

Extracted text: 3. You are an internet service provider and you have two types of customers, households and businesses. Business demand for your service is qb = 6500 – 100p, and household demand is q, = 12500 – 500p. Your marginal cost is MC( + qh) = 20/3 + (g + Ih)/150. Calculate the profit maximising prices you should charge the two goups under market segmentation (ie. third degree price discrimination).