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Katerina Botsaris
on Oct 27, 2024

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When a monopolist practices price discrimination,compared with a single-price monopolist,producer surplus will:

A) remain the same.
B) increase.
C) decrease.
D) increase initially and then return to its original level.

Price Discrimination

A pricing strategy where identical or similar goods or services are sold at different prices by the same provider in different markets or to different segments of consumers.

Producer Surplus

The difference between what producers are willing to sell a product for and the actual price they receive, representing extra benefit or profit for producers.

Single-Price Monopolist

A monopolist that offers its product to all consumers at the same price.

  • Determine the essential conditions that lead to price discrimination and analyze its consequences on the surplus received by producers and consumers.
  • Examine the reasons why monopolies engage in price discrimination and the impact of such practices on profits and welfare.
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Peris StarksNov 01, 2024
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