The table given below shows the price, marginal revenue and marginal cost of a monopolist at different levels of the output. The firm does not incur a fixed cost of production.Table 11.4

-Grocery store coupons, mail-in rebates, senior discounts, and in-state versus out-of-state tuition fees are all examples of:
A)government intervention.
B)price neutrality.
C)arbitrage pricing.
D)price discrimination.
E)illegal business practice.

Question

The table given below shows the price, marginal revenue and marginal cost of a monopolist at different levels of the output. The firm does not incur a fixed cost of production.Table 11.4
 
-Grocery store coupons, mail-in rebates, senior discounts, and in-state versus out-of-state tuition fees are all examples of:
A)government intervention. 
B)price neutrality. 
C)arbitrage pricing. 
D)price discrimination. 
E)illegal business practice.

Quizplus · Accepted Answer

The examples listed in the question are all methods of price discrimination, which is when a firm charges different prices for the same product or service to different groups of people. This practice can be legal as long as it does not violate anti-discrimination laws.

The Table Given Below Shows the Price, Marginal Revenue and Marginal