Pak has divided his customers into two groups so that he can charge a higher price to one group than the other. Which of the following should be TRUE about the group that pays a higher price?
A)This group gains a higher marginal benefit from the product than the group paying a lower price.
B)This group has a lower reservation price than the group paying a lower price.
C)This group has less market power than the group paying a lower price.
D)This group has a more elastic demand than the group paying a lower price.

Question

Quizplus · Accepted Answer

If Pak is charging a higher price to one group, it means that this group is willing to pay more for the product, which suggests that they gain a higher marginal benefit from it compared to the group paying a lower price.

Pak Has Divided His Customers into Two Groups So That