The monopolist would maximize profits by setting MR=MC for each customer group
MC=20
MR=twice the slope of the demand curve
Group 1: -
140-2Q
MR = 140-4Q
Setting MR=MC
140-4Q=20
140-20 = 4Q
Q=120/4 = 30
P=140-2(30) = 80
Group 2:-
180-4Q
MR=180-8Q
Setting MR=MC
180-8Q=20
180-20=8Q
Q=160/8 = 20
P=180-4(20) = 100
So,option (B) is correct as the firm will maximize profits by setting P=100 for any quantity but when the Q is greater than 30,the firm will maximize profits by setting P=80
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