Price discrimination is permissible if if the seller manufactures different qualities of the same product for different retailers and can prove that the price difference is proportional.

Question

Quizplus · Accepted Answer

Price discrimination can be justified if the price difference is proportional to the difference in quality, cost or other relevant characteristics of the goods or services sold. This is known as "the cost justification defense." If a seller is manufacturing different qualities of the same product for different retailers and the price difference is proportional, the price discrimination is considered permissible. However, if the price discrimination results in an anticompetitive effect, it may still be considered illegal.

Price Discrimination Is Permissible If If the Seller Manufactures Different