To increase profits with price discrimination,different groups of an oligopolist's customers must respond differently to prices of the good.

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Price discrimination involves charging different prices to different groups of customers based on their willingness to pay. For this strategy to be effective in increasing profits, these groups must have differentiated responses to changes in price. Otherwise, the firm may simply lose sales and revenue from customers who are not willing to pay the higher price.

To Increase Profits with Price Discrimination,different Groups of an Oligopolist's