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142_12 - Price Discrimination Definition setting different...

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Villas-Boas - Lecture 12 EEP 142 Page 0 Price Discrimination Definition: setting different prices for the same good Cost-based price differences are not considered price discrimination (for example, price differences based on transportation costs) A firm’s ability to price discriminate depends on: Arbitrage or resale by different consumer groups Competition from firms providing perfect substitutes knowledge of consumers’ willingness to pay
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