What problem does price discrimination resolve that occurs when businesses exploit market power?
A)High price
B)High costs
C)Underproduction
D)Overproduction

Question

Quizplus · Accepted Answer

Price discrimination helps to resolve the issue of underproduction that can occur when businesses exploit market power by allowing them to charge different prices to different groups of consumers. This can lead to an increase in production to meet the demand of consumers who are willing to pay more, thus reducing the problem of underproduction.

What Problem Does Price Discrimination Resolve That Occurs When Businesses