Asked by Sheri Walton on Jul 08, 2024
Verified
Price discrimination is the practice of:
A) charging different prices to buyers of the same good.
B) paying different prices to suppliers of the same good.
C) equating price to marginal cost.
D) equating price to marginal revenue.
Price Discrimination
A pricing strategy where a seller charges different prices for the same product or service to different customers, not based on differences in costs.
Marginal Cost
The additional expense incurred from producing another unit of a product.
Marginal Revenue
The additional revenue that a company generates from selling one more unit of a good or service.
- Comprehend the principles and implications of price discrimination in monopolistic and imperfectly competitive markets.
Verified Answer
AB
Alyssa'Caelie BurdenJul 09, 2024
Final Answer :
A
Explanation :
Price discrimination is the practice of charging different prices to buyers of the same good. This can be done based on various factors such as time of purchase, location, quantity purchased, or buyer characteristics such as age or income. This allows the seller to capture more of the consumer surplus and increase profits.
Learning Objectives
- Comprehend the principles and implications of price discrimination in monopolistic and imperfectly competitive markets.