Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Charging different prices to different consumers based solely on their income levels.
B
Offering the same product at different prices based on consumer behavior and willingness to pay.
C
Selling products at a uniform price across all market segments without considering consumer preferences.
D
Implementing a flat rate pricing strategy for all consumers regardless of their purchase history.
Understanding the Answer
Let's break down why this is correct
Answer
Price discrimination in digital markets means charging different prices to different customers for the same product or service. This practice works well because digital companies can easily gather data about their customers, such as their buying habits and preferences. For example, a streaming service might offer a discount to students while charging regular prices to other users, allowing them to attract a wider range of customers. Market segmentation is related because it involves dividing customers into groups based on their willingness to pay, enabling companies to set prices that maximize their profits. Overall, price discrimination helps businesses cater to different customer needs while increasing their overall sales.
Detailed Explanation
This option is correct because it shows how companies charge different prices based on what people are willing to pay. Other options are incorrect because This answer suggests that prices only depend on income; This choice says everyone pays the same price, ignoring what people prefer.
Key Concepts
definition of price discrimination
price discrimination and market segmentation
price discrimination in digital markets
Topic
Understanding Price Discrimination
Difficulty
hard level question
Cognitive Level
understand
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