Establishing Different Prices for Similar Products to Reflect Differences in Marginal

question 38

Multiple Choice

Establishing different prices for similar products to reflect differences in marginal cost in providing those goods to different groups of buyers is

• A) price discrimination.
• B) cost-plus pricing.
• C) price differentiation.
• D) product differentiation.

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Definitions:

Tying Contracts

A business practice where a seller requires the buyer to purchase a secondary product or service together with a primary product or service.

Price Discrimination

Price Discrimination is a pricing strategy where a firm charges different prices for the same product or service to different consumers, based on their willingness to pay.

Producer Surplus

The difference between what producers are willing to accept for a good or service and the actual price they receive.

Price Discrimination

Price discrimination refers to the strategy of selling the same product at different prices to different groups of customers, based on their willingness to pay.