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Microeconomics (Y13) > Price discrimination > Flashcards

Price discrimination Flashcards

1
Q

What is the definition of price discrimination?

A

Charging different prices to different groups of people for the same good

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2
Q

What is the aim of price discrimination?

A

Enable firms to make more profit

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3
Q

What are the conditions for price discrimination?

A

Market structure , Barriers to entry, market demand , prevention of arbitrage , low cost in separating markets

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4
Q

What are the benefits of price discrimination to the consumer?

A

-High quality , cheap price

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5
Q

What are the negatives of price discrimination to the consumer?

A

Expensive price, less competition in the long run

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6
Q

What are the positives of price discrimination for the producer?

A

Higher supernormal profit=> dynamic efficiency, high barriers to entry.

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7
Q

What are negatives of price discrimination for the producer?

A

Potential involvement of the CMA, High SNP

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Microeconomics (Y13) (8 decks)

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