econ newconnet
Price discrimination is only possible when a firm is a price
maker
In a pure monopoly. the firm Is willing to sell to anyone willing and able to pay at least the marginal cost of production.
The result is that output is produced where D = MC
When a firm charges different prices per unit for different quantities, or blocks, of a good or service. It practices second-degree price discrimination. This is most commonly done by
a pure monopoly
n a pure monopoly, the firm is willing to sell to anyone willing and able to pay at least the marginal cost Of production. The result is that output is produced where D = MC which is
allocatively
A business will charge a to the group with the relatively more elastjc demand and a higher to the group with the relatively more inelastic
elastic inelastic
Allocative efficiency is:
producing the goods and services so that their marginal benefit equals their marginal cost.
profit equals the total minus the total
revenue cost
In a pure monopoly, the firm is willing to sell to anyone willing and able to pay at least the marginal cost of production. The result is that output is produced where D MC
which is allocatively efficeient