Which of the following is not a prerequisite for practicing third-degree price discrimination?
A)Some degree of monopoly power
B)Ability to separate customers into two or more identifiable groups
C)Some mechanism to prevent resale of the product among groups
D)A perfectly competitive market for inputs

Question

Quizplus · Accepted Answer

A perfectly competitive market for inputs is not a prerequisite for practicing third-degree price discrimination. This is because the focus is on the market for consumers and how to differentiate pricing based on their willingness to pay, not on the cost of inputs for production. However, monopolistic power, the ability to segment customers, and a mechanism to prevent resale are crucial prerequisites for third-degree price discrimination.

Which of the Following Is Not a Prerequisite for Practicing