5.What is price discrimination? Give two examples of the power of a monopolist to practice price discrimination.
Price discrimination implies charging different prices for the same product from different buyers at the same time. A monopolist firm enjoys the freedom to follow price discrimination.Two examples of the power of a monopolist to practice price discrimination are as follows.
1) A lawyer may charge a low fees from his poor clients and a high fees from his rich clients.
2) Providing consumption goods free of tax to retired defense personnel and imposing tax on other people by Indian government.
1) A lawyer may charge a low fees from his poor clients and a high fees from his rich clients.
2) Providing consumption goods free of tax to retired defense personnel and imposing tax on other people by Indian government.
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