In third- degree price discrimination, the price markup is smaller in the markets that are less responsive to price changes.

Question

Quizplus · Accepted Answer

In third-degree price discrimination, the price markup is larger in markets that are less responsive to price changes (i.e., markets with more inelastic demand), because consumers in these markets are less sensitive to price increases and thus can be charged more.

In Third- Degree Price Discrimination, the Price Markup Is Smaller