Perfect price discrimination means:
A) charging each consumer a price exactly equal to his or her willingness to pay.
B) charging the exact same price to each consumer regardless of his or her willingness to pay.
C) charging different prices to different consumers so as to maximize consumer surplus.
D) charging each consumer a price exactly equal to the marginal cost of selling the good to that consumer.

Question

Quizplus · Accepted Answer

Perfect price discrimination involves charging each consumer the highest price they are willing to pay for a product or service. This means that the seller can capture all of the consumer surplus that would otherwise be enjoyed by buyers in a less efficient market. Perfect price discrimination can be difficult to achieve in practice, but it is the optimal outcome from the perspective of the seller. Choice A describes perfect price discrimination, so it is the best answer.

Perfect Price Discrimination Means