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Unformatted text preview: buyers see the same price schedule. Ex. Different sizes of drinks. Medium, Large, Ex-large, Gulp. C. 3 rd Degree : Different Prices to different Groups of buyers based on Different elasticities of demand. 1. Raise the price to the inelastic demanders. 2. Lower the price to the more elastic demanders. $Price Qty / Time MR Pm Q m Qc Marginal Cost MC 1. Grocery coupons 2. Theaters 3. Airlines & Hotels 4. Newly released unique products (Segway) 5. Prescription drugs in different countries. 6. Brand name Mixers (Holiday) 7. Mattresses: Match any advertised price 8. Menu (Freeway) 9. Menu (Chinese) D. Necessary Conditions for Successful Price Discrimination 1. Ability to identify and separate buyers by elasticity of demand. 2. Collect different prices from the different buyers 3. Prevent Resale...
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