Marta owns a food truck. Which of the following would limit Marta's ability to price discriminate?
A)Marta's product is good only if it is consumed immediately, making it difficult to store for resale.
B)Marta has considerable market power because she is the only seller in town of of that kind of food.
C)Marta has little understanding of how much each customer values her product.
D)Marta is facing rising costs.

Question

Quizplus · Accepted Answer

Price discrimination relies on the ability to differentiate customers based on their willingness to pay. If Marta has little understanding of how much each customer values her product, it will be difficult for her to charge different prices to different customers. The other options (A, B, D) do not necessarily limit Marta's ability to price discriminate.

Marta Owns a Food Truck