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Tristan Llewellyn
on Oct 14, 2024

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It is possible that a profit-maximizing monopolist who is able to practice first-degree (perfect)price discrimination would sell a quantity x such that the demand curve for his product is inelastic when the quantity sold is x.

First-Degree (Perfect) Price Discrimination

A pricing strategy where a seller charges the maximum possible price for each unit consumed that the consumer is willing to pay.

Profit-Maximizing Monopolist

A monopolist's strategy of setting a level of production and price that maximizes its profits.

Inelastic

A characteristic of goods whose demand or supply is not significantly altered when the price changes.

  • Gain insight into the theory of first-degree (perfect) price discrimination and its potential to increase profits.
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chase pattersonOct 15, 2024
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