Which of the following statements regarding perfect price discrimination is false?
A) Perfect price discrimination is charging different prices to different buyers.
B) Perfect price discrimination is an attempt by monopolists to capture consumer surplus as profit.
C) Perfect price discrimination can eliminate the deadweight loss to society of a monopoly.
D) Perfect price discrimination yields the same market price and output result as perfect competition.

Question

Quizplus · Accepted Answer

Perfect price discrimination results in the monopolist capturing all consumer surplus, not in the same market outcomes as perfect competition. In perfect competition, prices equal marginal costs, and consumer surplus exists, whereas perfect price discrimination leads to prices varying for each unit sold, tailored to the maximum willingness to pay of each consumer, without necessarily equating price to marginal cost for all units.

Which of the Following Statements Regarding Perfect Price Discrimination Is