Compared to setting a single price, if a firm can price discriminate it makes a lower economic profit has no change in its economic profit from when it set a single price makes a larger economic profit

Compared to setting a single price, if a firm can price discriminate it makes a lower economic profit has no change in its economic profit from when it set a single price makes a larger economic profit

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter23: Monopoly

Section: Chapter Questions

Problem 2WNG

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Concept explainers

Price Discrimination

Price discrimination or differential pricing is based on the principle that the seller will charge the buyer a price based on the buyer’s ability and willingness to pay for the product rather than applying uniform pricing for all.

Question

Compared to setting a single price, if a firm can price discriminate it
makes a lower economic profit
has no change in its economic profit from when it set a single price
makes a larger economic profit

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