Price Discrimination Can Help Improve Efficiency in the Market Because

question 73

Multiple Choice

Price discrimination can help improve efficiency in the market because goods are sold to more people, thus increasing profits. If all consumers have similar tastes, will a firm be able to price-discriminate?

• A) Yes, because the market is homogeneous
• B) Yes, as long as reselling is prohibited in the market
• C) No, because the firm will not be able to distinguish among groups of consumers
• D) No, because the similarities among consumers will lead to collusion among buyers
• E) Yes, because there will be a monopoly in the market (because all consumers want to purchase the same goods and services)

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