An amusement park is considering implementing a block pricing scheme. They believe there are two types of customers th

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An amusement park is considering implementing a block pricing scheme. They believe there are two types of customers that are distinguished by the intensity of their desire to go on rides. The ride-lovers have a demand function QH = 100 – 10P. The ride-likers have a demand function: QL = 60 – 10P. The amusement knows that it cannot tell one type from the other based on any observable characteristic, so that it must take into account the possibility that the ride-lovers may substitute downward for the ride-likers’block unless they design and price each block wisely.a. As a benchmark, what would the profit-maximizing block pricing scheme be if the park could tell each type apart by some observable characteristic? What would the profits per person of each type be in that case?b. How much consumer surplus would the ride-lovers earn from purchasing the block intended for the ride-likers that you designed in part a?c. Using your answers to “a” and “b,” provide menu pricing (second-degree) price discrimination options that induces the ride-lovers to buy the big block and the ride-likers to buy the small block. Compute the profits per person of each type associated with these blocks.d. Denote the number of ride lovers as NH and the number of ride likers as NL. Compute the maximum ratio NH/NL for which the firm will still wish to serve both types of consumers.