A coffee shop sells a small cup of coffee at $3,while a large cup,which is twice as big,at $5.This is an example of
A)first-degree price discrimination.
B)second-degree price discrimination.
C)third-degree price discrimination.
D)actual cost differences.

Question

Quizplus · Accepted Answer

Second-degree price discrimination involves charging different prices based on the quantity consumed or the version of the product, without regard to the identity of the buyer. In this case, the coffee shop charges a lower per-unit price for the larger quantity (large cup), which fits the definition of second-degree price discrimination.

A Coffee Shop Sells a Small Cup of Coffee at $3,while