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Suppose you can separate consumers into two groups:Group 1 has a price elasticity of demand = -2 and group 2 has a price elasticity of
Suppose you can separate consumers into two groups:Group 1 has a price elasticity of demand = -2 and group 2 has a price elasticity of demand of -6.If you could conduct third degree price discrimination, which group would you charge a higher price to?Why?Specifically, what would the relative price of group 1 to group 2 be (solve for P1/P2).Show all your work.
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