Third-Degree Price Discrimination Exists Whenever

question 1

Multiple Choice

Third-degree price discrimination exists whenever:

• A) the seller knows exactly how much each potential customer is willing to pay and will charge accordingly.
• B) different prices are charged by blocks of services.
• C) the seller can separate markets by geography,income,age,etc.,and charge different prices to these different groups.
• D) the seller will bargain with buyers in each of the markets to obtain the best possible price.

---

Definitions:

Fixed Costs

Expenses that do not change with the level of production or sales, such as rent, salaries, or insurance, and must be paid regardless of business activity.

Variable Costs

Costs that vary directly with the level of production or volume of output, as opposed to fixed costs, which remain constant regardless of production levels.

Price

The amount of money required to purchase a good or service.

Income Statement

A financial statement that shows profits or losses at one point in time.