If Sellers Could Price-Discriminate and Charge Two Different Prices to Two

question 235

Multiple Choice

If sellers could price-discriminate and charge two different prices to two different groups of buyers in order to increase revenues, then the sellers would charge

• A) a higher price to the buyers whose demand is elastic.
• B) a higher price to the buyers whose demand is inelastic.
• C) a higher price to the buyers whose demand is unit-elastic.
• D) the same price, actually, because price-discrimination will result in lower revenues.

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Definitions:

Cognitive Dissonance

A psychological phenomenon where there is a conflict between one's beliefs and behaviors, causing discomfort which individuals are motivated to reduce.

Emotional State

An emotional state is the temporary condition of experiencing specific emotions, which can influence cognition, behavior, and interpersonal interactions.

Beliefs

Beliefs or assurances in the existence or truth of something, especially without evidence.

Hopelessness

A feeling or state in which an individual perceives their situation as bleak or insurmountable, leading to despair and a loss of motivation.