Price discrimination requires that different customers have different levels of price sensitivity and that
A)the cost of production is different for every customer.
B)customers cannot resell the product amongst themselves.
C)demand is homogeneous amongst customers.
D)marginal costs are falling.

Question

Quizplus · Accepted Answer

Price discrimination relies on the ability to charge different prices to different customer segments based on their varying levels of price sensitivity. If customers are able to resell the product amongst themselves, it becomes more difficult to enforce different prices for different segments. Therefore, option B is the correct choice.

Price Discrimination Requires That Different Customers Have Different Levels of Price