Answer should be typed. Question 2EasyTax markets both a deluxe and a standard version of its software. The deluxe version containsadditional features that are likely to appeal to sophisticated users. The marginal costs of producingand distributing the two versions are virtually equal, and equal to zero. The market is equally dividedinto two types of users, sophisticated and unsophisticated (and assume one user of each type). Themaximum willingness to pay for both types of users for the standard and deluxe versions are givenin the following table:Standard2035Deluxe20100UnsophisticatedSophisticated(a) Assuming that the company producing EasyTax can distinguish between sophisticated andunsophisticated users (because, for instance, the sophisticated users are registeredaccountants), what are the optimal prices to be charged to each category of users? What isthe company's profit?(b) Assume now that the company cannot distinguish between the two types of user. What arethe optimal prices for the two versions? What is the total profit?

This question is about price discrimination, which is a pricing strategy where a company charges…

(a) Assuming that the company producing EasyTax can distinguish between sophisticated and unsophisticated users (because, for instance, the sophisticated users are registered accountants), what are the optimal prices to be charged to each category of users? What is the company's profit? (b) Assume now that the company cannot distinguish between the two types of user. What are the optimal prices for the two versions? What is the total profit?