Why does price discrimination improve the efficiency of the market compared to monopoly or monopolistic competition?
a. price discrimination only occurs in a perfectly competitive environment.
b. perfect price discrimination allows us to be at a point where mc =
d.
c. it forces firms who do not price-discriminate to leave the business.
d. it allows firms to produce goods at the minimum efficient scale?

Question

22-05-2018
Business

contestada

Why does price discrimination improve the efficiency of the market compared to monopoly or monopolistic competition?
a. price discrimination only occurs in a perfectly competitive environment.
b. perfect price discrimination allows us to be at a point where mc =
d.
c. it forces firms who do not price-discriminate to leave the business.
d. it allows firms to produce goods at the minimum efficient scale?

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MrsTriplet MrsTriplet · Answer 1 · 2018-06-01T02:43:27+02:00

Why does price discrimination improve the efficiency of the market compared to monopoly or monopolistic competition? Perfect price discrimination allows us to be at a point where MC = D. Monopolistic competition equals demand for the product in the equation above. Because price discrimination relates to the price of an item changing based on the demand for it, it is ideal for demand to align with the market competition.