In which scenario would price discrimination be most effectively implemented by a firm?

Price discrimination is most effectively implemented when a firm can identify different groups of customers who are willing to pay different prices for the same product or service. For example, a movie theater might charge lower prices for children and seniors while charging adults full price. This works well because it allows the theater to attract more customers who might not come at the higher price, while still maximizing profits from those who are willing to pay more. Additionally, the firm must be able to prevent customers from reselling the product at a different price, ensuring that each group pays what they are willing to pay. Overall, effective price discrimination helps a firm increase sales and profits by catering to the varying willingness to pay among different customers.