Use the figure below to answer the following questions.

Figure 13.4.2
-Refer to Figure 13.4.2. Assume this monopolist practises perfect price discrimination. This means that
A)the monopoly's behaviour is illegal.
B)one price is charged to young people and a different price to older people.
C)a different price can be charged to each buyer.
D)price will rise as the number of buyers increases.
E)the quantity sold will be less compared to the case of no price discrimination.

Question

Use the figure below to answer the following questions.
  
Figure 13.4.2
-Refer to Figure 13.4.2. Assume this monopolist practises perfect price discrimination. This means that
A)the monopoly's behaviour is illegal. 
B)one price is charged to young people and a different price to older people. 
C)a different price can be charged to each buyer. 
D)price will rise as the number of buyers increases. 
E)the quantity sold will be less compared to the case of no price discrimination.

Quizplus · Accepted Answer

Perfect price discrimination means that the monopolist can charge a different price to each buyer, maximizing profits by charging each buyer the highest price they are willing to pay. This results in the monopolist capturing all possible consumer surplus, leading to higher profits than if a single price were charged to all buyers. Therefore, the correct answer is C.

Use the Figure Below to Answer the Following Questions