Cereal manufacturers' use of coupons can be partially explained by:
A) first-degree price discrimination.
B) second-degree price discrimination.
C) third-degree price discrimination.
D) markup pricing.
E) tying.

Question

Quizplus · Accepted Answer

Cereal manufacturers use coupons as a form of third-degree price discrimination, as they offer different prices to different groups of consumers based on their willingness to pay. Coupons allow manufacturers to offer discounts to price-sensitive consumers while still charging higher prices to those who are willing to pay more. This allows them to maximize profits by capturing a larger share of the market.

Cereal Manufacturers' Use of Coupons Can Be Partially Explained By