Under what circumstances will a price-discriminating monopolist tend to charge a lower price to students?
A) If it believes student demand is more inelastic than other demanders.
B) If it believes student demand is graphically represented by a vertical curve.
C) If it believes student demand is more elastic than other demanders.
D) If it believes student demand is unit elastic.

Question

Quizplus · Accepted Answer

A price-discriminating monopolist will tend to charge a lower price to students if it believes their demand is more elastic than other demanders. This is because students are generally more price-sensitive and responsive to changes in price compared to other demanders, and a lower price will likely result in an increase in their demand.

Under What Circumstances Will a Price-Discriminating Monopolist Tend to Charge