Question
A seller engages in price discrimination by market segment. Local resident customers have a price elasticity of demand E = -2, while other customers have
A seller engages in price discrimination by market segment. Local resident customers have a price elasticity of demand E = -2, while other customers have a price elasticity of demand E = -6. The MC of selling to both groups is the same and constant at $20. Therefore:
local residents will pay P=$30, while other customers will pay $24.
local residents will pay P=$40, while other customers will pay $60.
local residents will pay P=$40, while other customers will pay $24.
local residents will pay P=$30, while other customers will pay $60.
all customers will pay $20.
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