Suppose a monopoly sells to two identifiably different types of custom

Suppose a monopoly sells to two identifiably different types of customers, A and B, who are unable to practice arbitrage. The inverse demand curve for group A is PA = 10 – QA, and the inverse demand curve for group B is PB = 18 – QB. The monopolist is able to produce the good for either type of customer at a constant marginal cost of 2, and the monopolist has no fixed costs. If the monopoly uses uniform pricing, the deadweight loss is 36. If the monopolist is able to practice group price discrimination, the deadweight loss is

A) 30.
B) 32.
C) 34.
D) 36.

ANSWER

B