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Price discrimination is the practice of charging the highest price to different consumers. This is so that the firm can maximize the revenue it receives for the goods it produces. Price discrimination is mainly for markets that are monopolistic, or oligopolistic. In these kinds of markets the firm has to decrease price in order to sell more of the good because they are the only supplier. Because of this marginal revenue is derived from the demand but the profit maximization condition is still marginal cost equals marginal benefits but marginal benefits does not equal the demand curve. The firm wants to price discriminate in order to avoid the decreased revenues because of the lost revenue because they have to decrease prices to get more consumers. One of the biggest problems in practicing price discrimination is that the firm needs perfect information in order to maximize the returns to price discrimination. Finding this information could be very costly to obtain, or could be realistically impossible to obtain.
Wiki User
∙ 15y ago
Wiki User
∙ 15y agoDiscrimination Pricing is a pricing strategy that charges customers different prices for the same product or service. In pure price discrimination, the seller will charge each customer the maximum price that he or she is willing to pay. In more common forms of price discrimination, the seller places customers in groups based on certain attributes and charges each group a different price.
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What is covert discrimination?
Covert discrimination is hidden or subtle discrimination. It is opposed to overt discrimination, which is open and obvious. .
What is the production and pricing aspects?
production and pricing aspects
How do concept such as psychological pricing and reference pricing apply to the marketing strategy?
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Price discrimination is indistinguishable from dumping?
Price discrimination is indistinguishable
What is the difference in Net and gross pricing in construction?
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What are the different pricing methods in international marketing?
Bid Pricing Cost Plus Pricing Customary Pricing Differential Pricing Diversionary Pricing Dumping Pricing Experience Curve Pricing Loss Leader Pricing Market Pricing Predatory Pricing Prestige Pricing Professional Pricing Promotional Pricing Single Price for all Special Event Pricing Target Pricing
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An arbitrage pricing theory is a theory of asset pricing serving as a framework for the arbitrage pricing model.
How does institutional discrimination differ from individual discrimination?
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What is covert discrimination?
Covert discrimination is hidden or subtle discrimination. It is opposed to overt discrimination, which is open and obvious. .
What do you mean by pricing?
transfer pricing is in the case of transferred with in the organisation the pricing of contribution for assets ,
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What do you mean by transfer pricing?
transfer pricing is in the case of transferred with in the organisation the pricing of contribution for assets ,
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What approach to pricing Cost based pricing Competition Based Pricing Demand based pricing?
I'm doing a school assignment so I have no clue! :)
