Internet service in the local market is supplied by Laura's Internet Service. The demand is Laura's marginal cost function is If Laura practices first-degree price discrimination, what are consumer surplus and Laura's producer surplus in this market? Does Laura's market power and first-degree price discrimination result in reduced societal welfare?

If Laura can first-degree price discriminate, she will charge the highest price each consumer is willing-to-pay. This implies she will continue selling units until the price of the last unit sold equals her marginal cost.
P = 65 - 0.01Q = MC = 6.67 + 0.0067Q
Therefore Q = 3,492.8
Producer surplus is
PS = (0.5)(65 - 6.67)(3,492.81) = 101,867.80
Since the price of the last unit sold is equal to the marginal cost, Laura's output level is efficient. However, since Laura is first-degree price discriminating, consumer surplus is zero. Social welfare in this market structure is as high as possible given the efficient level of units are produced.