A price-discriminating monopoly is a monopoly that
A) sells its output at a single price to all of its customers.
B) sells different units of a good or service at different prices.
C) has control over the resources used to produce the product.
D) has a license to sell the product.
E) illegally charges different customers different prices for the good it produces.

Question

Quizplus · Accepted Answer

A price-discriminating monopoly sells different units of a good or service at different prices. This allows the monopoly to charge higher prices to customers with a higher willingness to pay and lower prices to customers with a lower willingness to pay. This maximizes the monopoly's profits.

A Price-Discriminating Monopoly Is a Monopoly That