If a Firm Sells to Two Distinct Identifiable Markets and Resale

question 98

Essay

If a firm sells to two distinct identifiable markets and resale is impossible,why is price discrimination more profitable than setting a single price?

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Definitions:

Note Issuance

Note issuance involves the creation and offering of a promissory note, a financial instrument wherein the issuer promises to pay a specific amount to the holder on demand or at a future date.

Estimable Liability

A financial obligation or debt that can be measured or estimated with a reasonable level of accuracy.

Probable Likelihood

A high chance or probability that an event will occur.

Accrual

A method of accounting that records income and expenses when they are earned or incurred, regardless of when the cash transactions occur.