For direct price discrimination to work,the firm
A)Must be able to identify members of the low value group
B)Charge the low-value group lower prices than the rest
C)Prevent the low-value group from reselling their low priced goods to higher-valued group
D)All of the above

Question

​For direct price discrimination to work,the firm
A)​Must be able to identify members of the low value group
B)Charge the low-value group lower prices than the rest
C)Prevent the low-value group from reselling their low priced goods to higher-valued group
D)​All of the above

Quizplus · Accepted Answer

All of the above statements are true for direct price discrimination to work effectively. The firm must be able to identify members of the low-value group, charge them a lower price than the high-value group, and prevent them from reselling the product to the high-value group. Failure to do any one of these could lead to the collapse of the direct price discrimination strategy.

​For Direct Price Discrimination to Work,the Firm

For Direct Price Discrimination to Work,the Firm