What is Price Discrimination?
- Price discrimination is when a business sells the same product to different buyers at different prices.
How Do I Remember It?
- Think of price discrimination as “discriminating” prices based on what the customers are willing to pay. It’s like charging higher prices to customers who value the product more, while offering discounts to those who are less willing to pay.
Real World Example
- An example of price discrimination is movie theaters offering discounted tickets to students or seniors. The theater charges different prices based on the customer’s age or status, even though they are all watching the same movie. This allows the theater to maximize its revenue by capturing more of the consumer surplus.
Follow us on TikTok, Instagram, and YouTube below.
By: Ryan Aquino
