If a monopolist practices perfect price discrimination, then it will have
A)a greater total revenue and sell a greater output than if it were not practicing price discrimination.
B)a smaller total revenue and sell a smaller output than if it were not practicing price discrimination.
C)the same total revenue but sell a larger output than if it were not practicing price discrimination.
D)the same total revenue but sell a smaller output than if it were not practicing price discrimination.

Question

Quizplus · Accepted Answer

Perfect price discrimination allows a monopolist to capture all consumer surplus as revenue, leading to greater total revenue and the sale of a greater output compared to not practicing price discrimination. This is because the monopolist can charge each consumer the maximum they are willing to pay for each unit, thus selling to more consumers at various prices.

If a Monopolist Practices Perfect Price Discrimination, Then It Will