Which of the Following Is the Fundamental Condition That Would

question 178

Multiple Choice

Which of the following is the fundamental condition that would allow a firm to practice price discrimination?

• A) All customers possess identical willingness to pay for the product.
• B) The good can be purchased at one market and resold at another market.
• C) There are two or more different demand curves for the good.
• D) Demand for the good is high.

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Definitions:

Tax

A compulsory financial charge or levy imposed by a government on individuals or entities to fund public expenditure.

Consumer Surplus

The difference between the aggregate willingness to pay by consumers for a good or service and the aggregate actual payment.

Deadweight Loss

An economic inefficiency caused by a disruption in market equilibrium, leading to a loss of societal welfare.

Consumer Surplus

The disparity between the ideal total expenditure consumers are willing to make on a good or service and the real expenditure.