In ____ price discrimination,the monopolist charges each consumer the highest price that purchaser is willing to pay for each unit purchased (provided that this price exceeds the marginal cost of production).
A) first-degree
B) second-degree
C) third-degree
D) a and b
E) none of the above

Question

Quizplus · Accepted Answer

First-degree price discrimination, also known as perfect price discrimination, occurs when a monopolist charges each consumer the highest price they are willing to pay for each unit purchased. This allows the monopolist to capture all consumer surplus and maximize profits. However, first-degree price discrimination requires the monopolist to have complete information about each consumer's willingness to pay, which is often difficult to obtain in practice.

In ____ Price Discrimination,the Monopolist Charges Each Consumer the Highest