A firm practicing direct price discrimination will charge lower prices to

A) Consumers with an elastic demand
B) All consumers
C) Consumers known to have an inelastic demand
D) Consumers known to have a unitary elastic demand

Question

​A firm practicing direct price discrimination will charge lower prices toA) ​Consumers with an elastic demandB) All consumersC) Consumers known to have an inelastic demandD) ​Consumers known to have a unitary elastic demand

Zybrea Knight · Accepted Answer

Final Answer : A, Explanation :  Direct price discrimination involves charging different prices to different consumers based on their willingness to pay. Consumers with elastic demand are more price-sensitive and have a lower willingness to pay, so the firm will charge them a lower price to boost sales.

A firm practicing direct price discrimination will charge lower prices to

A) Consumers with an elastic demand
B) All consumers
C) Consumers known to have an inelastic demand
D) Consumers known to have a unitary elastic demand

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Learning Objectives

Learning Objectives

Related questions

​A firm practicing direct price discrimination will charge lower prices toA) ​Consumers with an elastic demandB) All consumersC) Consumers known to have an inelastic demandD) ​Consumers known to have a unitary elastic demand

Definitions

Learning Objectives

Learning Objectives

Related questions

A firm practicing direct price discrimination will charge lower prices to

A) Consumers with an elastic demand
B) All consumers
C) Consumers known to have an inelastic demand
D) Consumers known to have a unitary elastic demand