Microeconomics (7th Edition)
7th Edition
ISBN: 9780134737508
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Chapter 16, Problem 16.2.10PA
To determine
Legality of
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What is price discrimination?Briefly explain the first,second,and third degree price discrimination.
Please read the following article from The Atlantic on the proliferation of price discrimination for online shopping https://goo.gl/EGFynW
A.) The article notes that we are moving toward a situation in which perfect price discrimination is no longer “only a classroom thought experiment.” Suppose perfect price discrimination were to become a reality. What would this imply as far as consumer surplus, producer surplus, and market surplus in the market for online retail?
B.) The article references a study showing that by using big data online firms are able to boost profits. When firms engage in price discrimination and experience an increase in profits, does this imply that consumers are made worse off as a result? Explain.
C.) Do you agree with the author’s belief that the proliferation of price discrimination “makes suckers of us all”? Explain.
D.) Do you consider the increased price discrimination in recent years as a net positive or a net negative to society? Explain
Briefly explain the first, second , and third degree price discrimination
Chapter 16 Solutions
Microeconomics (7th Edition)
Ch. 16 - What is the law of one price? What is arbitrage?Ch. 16 - Prob. 16.1.2RQCh. 16 - Prob. 16.1.3PACh. 16 - Prob. 16.1.4PACh. 16 - Prob. 16.1.5PACh. 16 - Prob. 16.1.6PACh. 16 - Prob. 16.2.1RQCh. 16 - In 2017, the Rock and Roll Hall of Fame and Museum...Ch. 16 - Prob. 16.2.3RQCh. 16 - Prob. 16.2.4PA
Ch. 16 - Lexmark charges lower prices for its printer...Ch. 16 - Prob. 16.2.6PACh. 16 - Prob. 16.2.7PACh. 16 - Prob. 16.2.8PACh. 16 - Prob. 16.2.9PACh. 16 - Prob. 16.2.10PACh. 16 - Prob. 16.2.11PACh. 16 - Prob. 16.2.12PACh. 16 - Prob. 16.2.13PACh. 16 - Prob. 16.2.14PACh. 16 - Prob. 16.2.15PACh. 16 - Prob. 16.3.1RQCh. 16 - Prob. 16.3.2RQCh. 16 - Prob. 16.3.3RQCh. 16 - Prob. 16.3.4PACh. 16 - Prob. 16.3.5PACh. 16 - Prob. 16.3.6PACh. 16 - Prob. 16.3.7PACh. 16 - Prob. 16.3.8PACh. 16 - Prob. 16.3.9PACh. 16 - Prob. 16.3.10PACh. 16 - Prob. 16.3.11PACh. 16 - Prob. 16.3.12PACh. 16 - Prob. 16.2CTECh. 16 - Prob. 16.3CTE
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- Briefly explain each of the following types of pricing strategy, and give an example of a good or service that is sold using that pricing strategy. Block pricing. Two-part pricing. Multi-period pricing. Loss leading.arrow_forwardUse the following roundtable summary on price discrimination from the DOJ and FTC – Roundtable on Price Discrimination - to answer the following questions. a.) What conditions must be met in order for price discrimination to be feasible? What are the factors that determine the competitive implications of price discrimination? b.) Summarize the difference between price discrimination used for “exploitative” purposes vs. “exclusionary” purposes. Explain which – and why – one form is legal but the other is not? c.) Do you think there should be greater government regulations or oversight of firms’ ability to engage in price discrimination? Explain.arrow_forwardWhat is price discrimination?arrow_forward
- what are pricing tactics and examples? What are some forms of price discriminations?arrow_forwardList and explain the three kinds of pricing methods. Give an advantage and a disadvantage for each method.arrow_forwardECON: Industrial Organization Suppose two markets are identical except that in market A there is a monopoly seller who charges a single price, whereas in market B there is a monopoly seller who practices perfect price discrimination. In which market is the quantity traded higher? In which market is the total surplus higher? Briefly explain.arrow_forward
- Briefly summarize of pricing strategy of the Apple companyarrow_forwardBriefly explain each of the following types of pricing strategy, and give an example of a good or service that is sold using that pricing strategy. bundling loss leadingarrow_forwardBriefly explain and illustrate the impact of pure monopolistic price discrimination behaviour on international trade and the welfare of nations. You can make use of Big Tech as an example. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forward
- Caroline and Frances are debating the pricing strategy of several airlines. Caroline argues, “When airlines restrict discounted tickets to people who book well in advance and stay over on a Saturday, it is not price discrimination, because the restrictions have nothing to do with individual buyers' willingness to pay.” However, Frances says, “The airlines' stay-over restrictions are a form of price discrimination, because they roughly split the market into two separate groups that are willing to pay two different amounts.” Economists generally agree with who?arrow_forwardTara loves to go through the Saturday paper and cut out supermarket coupons. How do you think Tara's coupon-clipping habits apply to the concept of price discrimination?arrow_forwardwhat is the profit from perfect price discrimination?arrow_forward
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