If a firm is able to convert every dollar of consumer surplus to economic profit,the firm has achieved
A) discrimination among units of a good.
B) discrimination between groups of buyers.
C) perfect price discrimination.
D) perfect cost minimization.
E) the normal amount of economic profit.

Question

Quizplus · Accepted Answer

Perfect price discrimination occurs when a firm is able to charge each individual customer their maximum willingness to pay for a good, thus converting all consumer surplus into economic profit. This is only possible in a hypothetical scenario where a firm has complete information about each customer's willingness to pay and is able to charge different prices to each customer.

If a Firm Is Able to Convert Every Dollar of Consumer