Rowe Chan
01/05/2023 · Middle School
trategy underlying price discrimination is to reduce per-unit cost by charging higher prices to those with the most inelastic demand and lower prices to those with the most elastic demand. to charge everyone the same price but limit the quantity they are allowed to buy. to charge higher prices to customers who have good substitutes available to them and lower prices to customers without many substitutes available to them.. to increase total revenue by charging higher prices to those with the most inelastic demand for the product and lower prices to those with the most elastic demand.
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The strategy of price discrimination is to charge higher prices to those with less price sensitivity and lower prices to those with more price sensitivity to increase total revenue.
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