In the absence of price discrimination,:

Question

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In the absence of price discrimination, firms will charge everyone the same price for the good. This means that consumers who are willing to pay a higher price will purchase the good, while those who are only willing to pay a lower price will not. Thus, total consumption of the good will be lower. As a result, firms will produce less output to meet the lower demand, which means total output will be less. This also means that poorer consumers who cannot afford the higher price will be worse off as they will not be able to purchase the good.

In the Absence of Price Discrimination