Overview
Price discrimination is a crucial concept in economics that allows sellers to charge different prices to different consumers based on their willingness to pay. This strategy can lead to increased profits for businesses and greater access to products for consumers, enhancing overall market efficiency...
Key Terms
Example: A movie theater charges less for students.
Example: If a consumer is willing to pay $10 but pays $7, their surplus is $3.
Example: Segmenting by age, income, or location.
Example: An auction where the highest bidder pays their bid.
Example: Bulk discounts for buying larger quantities.
Example: Senior citizen discounts.
Related Topics
Key Concepts
Types of Price DiscriminationConsumer SurplusMarket SegmentationEfficiency