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Price discrimination occurs when:
  • a)
    Producer sells a specific commodity or service to different buyers for the same price
  • b)
    Producer sells specific commodity or service to different buyers at two or more different prices due to difference in cost
  • c)
    Producer sells a specific commodity or service to different buyers at two or more different prices for reasons not associate with difference in cost
  • d)
    Producer under perfect competition sells different goods to consumers at different prices
Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
Price discrimination occurs when:a)Producer sells a specific commodity...
Price Discrimination Explanation:
Price discrimination occurs when a producer sells a specific commodity or service to different buyers at two or more different prices for reasons not associated with differences in cost. This practice allows the producer to capture more consumer surplus and increase overall profits.

Types of Price Discrimination:
- First-degree price discrimination: This is when a producer charges each customer the maximum price they are willing to pay. This is often difficult to implement in practice.
- Second-degree price discrimination: This involves charging different prices based on quantity, such as offering discounts for bulk purchases.
- Third-degree price discrimination: This is the most common form, where prices are set based on different market segments, such as student discounts or senior citizen discounts.

Reasons for Price Discrimination:
- Market Power: Producers with market power can segment their customers and charge different prices to maximize profits.
- Price Sensitivity: Different consumers have different price sensitivities, allowing producers to charge higher prices to those willing to pay more.
- Market Segmentation: By dividing the market into different segments based on willingness to pay, producers can extract more value from each segment.

Examples of Price Discrimination:
- Airlines offering different prices for the same seat based on booking time or passenger type.
- Movie theaters offering discounts for children, seniors, or students.
- Software companies offering different pricing tiers for individuals and businesses.
In conclusion, price discrimination allows producers to capture more consumer surplus and increase profits by charging different prices to different segments of customers.
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Price discrimination occurs when:a)Producer sells a specific commodity or service to different buyers for the same priceb)Producer sells specific commodity or service to different buyers at two or more different prices due to difference in costc)Producer sells a specific commodity or service to different buyers at two or more different prices for reasons not associate with difference in costd)Producer under perfect competition sells different goods to consumers at different pricesCorrect answer is option 'C'. Can you explain this answer?
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Price discrimination occurs when:a)Producer sells a specific commodity or service to different buyers for the same priceb)Producer sells specific commodity or service to different buyers at two or more different prices due to difference in costc)Producer sells a specific commodity or service to different buyers at two or more different prices for reasons not associate with difference in costd)Producer under perfect competition sells different goods to consumers at different pricesCorrect answer is option 'C'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Price discrimination occurs when:a)Producer sells a specific commodity or service to different buyers for the same priceb)Producer sells specific commodity or service to different buyers at two or more different prices due to difference in costc)Producer sells a specific commodity or service to different buyers at two or more different prices for reasons not associate with difference in costd)Producer under perfect competition sells different goods to consumers at different pricesCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Price discrimination occurs when:a)Producer sells a specific commodity or service to different buyers for the same priceb)Producer sells specific commodity or service to different buyers at two or more different prices due to difference in costc)Producer sells a specific commodity or service to different buyers at two or more different prices for reasons not associate with difference in costd)Producer under perfect competition sells different goods to consumers at different pricesCorrect answer is option 'C'. Can you explain this answer?.
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