Which of the following is NOT a condition needed for price discrimination?
A)The company faces a flat demand curve.
B)The company knows how much different customers are willing to pay for the product.
C)The company has market power in its product market.
D)The company can keep customers from reselling the product after they have purchased it.

Question

Quizplus · Accepted Answer

Price discrimination requires that the company has market power, knows how much different customers are willing to pay, and can prevent customers from reselling the product after purchase. A flat demand curve is not a necessary condition for price discrimination; in fact, price discrimination is more likely to occur when the demand curve is downward-sloping as it allows the company to charge different prices to different segments of customers.

Which of the Following Is NOT a Condition Needed for Price