Because each customer pays according to her willingness to pay, a consumer maximizes her consumer surplus under first-degree price discrimination.

Name: Because each customer pays according to her willingness to pay, a consumer maximizes her consumer surplus under first-degree price discrimination.
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Question

Quizplus · Accepted Answer

Under first-degree price discrimination, the seller captures all the consumer surplus by charging each consumer their maximum willingness to pay, leaving no surplus for the consumer.

Because Each Customer Pays According to Her Willingness to Pay