Price discrimination allows a producer to
A)Reap the highest possible average price for the quantity supplied.
B)Increase the elasticity of consumer demand.
C)Minimize marginal costs.
D)Decrease total costs.

Question

Quizplus · Accepted Answer

Price discrimination allows a producer to charge different prices to different groups of consumers, which enables the producer to sell more to buyers who are willing to pay higher prices and less to those who are only willing to pay lower prices. This allows the producer to capture the highest possible average price for the quantity supplied.

Price Discrimination Allows a Producer to