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S E22: Price Discrimination - Why some people pay less

Think Like An Economist

CHAPTER

How to Price Discriminate - University of Michigan

A business has market power if it can charge high prices without losing many sales to a competing business. To price discriminate, you need to make sure that your business meets three conditions. You need to be able to prevent resale and figure out which customers can pay how much. The more aggressively a business price discriminates, the more important it is for them to stop people from re selling their product.

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