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Spotify, like other music streaming companies, utilizes a 2-tiered pricing model: (i) free with adds, and (ii) premium (paid) with no adds. Explain how, in

  1. Spotify, like other music streaming companies, utilizes a 2-tiered pricing model: (i) free with adds, and (ii) premium (paid) with no adds. Explain how, in effect, this is 3rd degree price discrimination (Hint: this would be similar to the logic behind coupons for rebates)? Moreover, how are the conditions to price-discriminate met?

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