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Folder:
115 CFA
File:
115.030.20.06 Economics - Reading 13 - 6. Price Discrimination

6. Price Discrimination

f. describe pricing strategy under each market structure;

What is price discrimination?
Price discrimination is a practice whereby a seller charges different consumers different prices for the same product or service. It converts consumer surplus into economic profit.

What is the difference between first/second/third degree price discrimination?
- First-degree price discrimination is where each consumer is charge the price he is willing to pay
- Second-degree price discrimination is where prices vary across units but not people
- Third-degree price discrimination is when consumers are segregated by demographics or other traits.


Source:
  • CFA