Third-degree price discrimination is the practice of dividing groups of purchasers into separate markets and charging different prices in each market.

Question

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Third-degree price discrimination involves charging different prices to different groups of purchasers, based on their willingness to pay. This can be achieved by dividing the purchasers into separate markets, such as by age, income, location, or other characteristics. This allows the seller to extract more revenue from those buyers who are willing to pay higher prices, while still making sales to those who are less willing to pay.

Third-Degree Price Discrimination Is the Practice of Dividing Groups of Purchasers