Consumers often don't understand nonlinear pricing well and make choices based on average prices rather than marginal prices. This can lead to suboptimal decisions. The study looked at how a monopolist can set prices optimally when consumers have different perceptions of prices. The results show that consumer misunderstanding of prices doesn't affect the best pricing strategy for maximum welfare. However, it can benefit the monopolist. Interestingly, more misunderstanding can benefit both consumers and the monopolist if the level of bias is low. Additionally, consumer bias in prices can hinder efforts to reduce overall consumption using certain pricing strategies.