If price discrimination occurs in a market,
A)the law of one price does not hold.
B)the firm earns arbitrage profits.
C)consumers whose demand for the product sold is more elastic pay higher prices than consumers whose demand is less elastic.
D)the marginal cost of production is constant.

Question

Quizplus · Accepted Answer

Price discrimination means charging different prices to different consumers, so the law of one price, which states that identical goods should sell for the same price, does not hold.

If Price Discrimination Occurs in a Market