Question

Can you think of an example when your consumer surplus has increased as a result of a firm engaging in price discrimination? When has your consumer surplus been reduced as a result of price discrimination?

Answer 1

Answer:
Price descrimination happens when identical goods are given at different rates to different consumer by the same supplier.
An example when consumer surplus has increased as a result of firm engaging in price discrimination is:

• Consumer who are highly elastic usually gain consumer surplus due to price discrimination. For instance Movie ticekts for senior citizen and child used to be at discounted rates. During my childhood i gained from this price descrimination.

Example when consumer surplus decreased as a result of price descriminations is:

• One of the brand of Sugar sell at higher rates in my state compare to other states, in this case price discrimination decreased consumer surplus.

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