To practice effective price discrimination,a monopolist must be able to:

A) estimate its own production and cost functions.
B) avoid charging too low a price.
C) prevent the resale of goods among groups of buyers.
D) calculate the income level of each buyer in the market.

Price Discrimination

A strategy in pricing where the same provider sells identical or nearly identical products or services for various prices across different markets or to distinct customer groups.

Production Functions

a mathematical relationship expressing the output that can be produced by a firm or economy from different combinations of factor inputs.

Resale of Goods

The act of selling previously purchased products, often used, to another party.