Suppose that a monopolist adopts a pricing scheme where,every Monday,all prices are 10% lower.This would be
A) a perfect hurdle.
B) an effective hurdle.
C) perfect price discrimination.
D) an ineffective hurdle because all consumers could wait until Monday to buy.
E) an effective hurdle because those who shop on Monday always have lower reservation prices.

Question

Quizplus · Accepted Answer

By announcing a 10% discount every Monday, the monopolist is not effectively segmenting the market. All consumers could simply wait until Monday to make their purchase, reducing the effectiveness of the pricing scheme as a hurdle. This pricing scheme is not an example of perfect or effective price discrimination, as the monopolist is not able to charge different prices to different groups based on their willingness to pay.

Suppose That a Monopolist Adopts a Pricing Scheme Where,every Monday,all