Asked by Nacole Watkins on Apr 25, 2024
Verified
A firm practicing direct price discrimination will charge a higher price to
A) Consumers known to have an elastic demand
B) All consumers
C) Consumers known to have an inelastic demand
D) Consumers known to have a unitary elastic demand
Direct Price Discrimination
A pricing strategy where a seller charges different prices to different customers for the same product or service, based on their willingness to pay.
Inelastic Demand
A situation in which demand for a good or service is barely affected by changes in price.
Elastic Demand
When consumer demand for a product significantly rises or falls following a small change in its price.
- Understand the significance of demand elasticity in the implementation of price differentiation tactics.
Verified Answer
Learning Objectives
- Understand the significance of demand elasticity in the implementation of price differentiation tactics.
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