A price-discriminating firm will adjust prices so that customers with more _____ demand pay _____ than (as) customers with _____ elastic demand.
A) inelastic; less; less
B) elastic; less; less
C) elastic; the same; more
D) elastic; more; less

Question

Quizplus · Accepted Answer

A price-discriminating firm charges lower prices to customers with more elastic demand because they are more sensitive to price changes, while charging higher prices to those with less elastic (more inelastic) demand.

A Price-Discriminating Firm Will Adjust Prices So That Customers with More