When might price discrimination be a rational strategy for a profit-maximizing monopolist?
A) when there is a substantial opportunity for reselling across market segmentations
B) when there is no opportunity for reselling across market segmentations
C) when consumers are unable to be segmented into identifiable markets
D) when the elasticity of demand is the same across all customers

Question

Quizplus · Accepted Answer

Price discrimination is a rational strategy for a profit-maximizing monopolist when there is no opportunity for reselling across market segmentations. This prevents arbitrage, allowing the monopolist to charge different prices to different consumer groups based on their willingness to pay.

When Might Price Discrimination Be a Rational Strategy for a Profit-Maximizing