Economics Consumer Surplus And Producer Surplus Questions
Price discrimination is a pricing strategy where a seller charges different prices to different customers for the same product or service based on their willingness to pay. This strategy allows the seller to capture a larger portion of the consumer surplus by charging higher prices to customers with a higher willingness to pay and lower prices to customers with a lower willingness to pay. Price discrimination can be achieved through various methods such as offering discounts to certain customer groups, implementing tiered pricing based on quantity or quality, or using personalized pricing based on individual customer characteristics.