Identify the correct statement about price discrimination.
A)Price discrimination is costless.
B)Price discrimination is effective only if demand for the product is perfectly inelastic.
C)Price discrimination is effective when producers face a downward-sloping demand curve.
D)Price discrimination increases consumer surplus.

Question

Quizplus · Accepted Answer

Price discrimination is most effective when producers face a downward-sloping demand curve. This means that certain groups of consumers are willing to pay more for a product than others, and price discrimination allows the producer to capture more of the consumer surplus. However, price discrimination is not costless and can require additional resources and effort to implement. Price discrimination can also decrease overall consumer surplus if certain groups are charged higher prices than they would have otherwise paid.

Identify the Correct Statement About Price Discrimination