Should Southwest Airlines Engage In Price Discrimination?

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Price discrimination is most effective when a higher price is charged in the market with inelastic demand, and a lower price is charged in the market with elastic demand. Southwest Airlines can charge higher prices for last minute flights and business flights. They can charge lower prices for flights booked in advance. Southwest can work with other businesses to bundle and let people vacation at a lower price. Example; Disney world works with airlines and rentals companies to give people the best deals they can. Southwest can offer points, rewards, and free flights to loyal customers.
Southwest Airlines does not have to be a monopoly to engage in price discrimination. They will need to have a market power, and they cannot be price takers.

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