When a monopoly price discriminates, it charges the highest price to the group of buyers with the least elastic demand.

Question

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This is the basic principle of price discrimination by monopolies. Monopolies can charge different prices to different groups of buyers based on their willingness to pay, and the group with the least elastic demand will be charged the highest price. This is because they are less likely to switch to alternative products or suppliers, even if the price increases.

When a Monopoly Price Discriminates, It Charges the Highest Price