Question

What is price discrimination? Is it legal? Under what conditions can sellers engage in price discrimination?

What is price discrimination? Is it legal? Under what conditions can sellers engage in price discrimination?

Homework Answers

Answer #1

Price Discrimination - it is a policy adopted by monopolistic . In price differentiation, different prices for sme product is charged from different connsumers. It is legal and there are three degrees of price discrimination.

Priya discriminate is based on elasticity of demand.

If demand for product is elastic then price discrimination will be less because consumer will stop buying products at high price.

If demand for product is inelastic then price discrimination will be high because consumer wil demand even the price is high.

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