Question

I need a respond to This answer ,like I agree with u .. etc

There are many examples of price discrimination in our life, such as quantity discrimination, which means for the same product, consumers who buy more quantity can get a discount and buy at a lower unit price, while consumers with less quantity can only buy at the original price. We can often see the slogan of "buy two get one free" in shopping malls, which is also a manifestation of quantity discrimination. In my opinion, the reason for this kind of price discrimination is that shopping malls hope to attract more customers and increase sales volume. Maybe customers just want to buy one, but when they see that they can get three for the price of two, which is more cost-effective than buying one. Finally they will decide to buy two, which increases the sales of the product.

The second example is about prime time. Some attractions or the surrounding hotels will increase the price in the peak season and reduce the price in the off-season. Because the peak season is the prime time for tourism. There are a lot of tourists. Even if the price is increased, it will not affect the sales volume. Because there is always someone willing to pay that price. But in the off-season, there are few tourists. If the price is still very high, it will have a significant impact on the reduction of passenger flow. Only by reducing the price, can merchants attract customers and maintain operation.

I think price discrimination can help me make better profits. For example, when I went to McDonald's with my friends to buy ice cream. Originally, only I wanted to eat it. But we found that the second McDonald's ice cream was half price. If I only bought one, I would feel that I missed the half price and it was not cost-effective. At that time, we would choose two people to buy together. On average, the unit price is cheaper for us. But for McDonald's, it sold an extra ice cream, and the price was still higher than its cost, which increased the profit.

Answer 1

There are many examples of price discrimination in our life, such as quantity discrimination, which means for the same product, consumers who buy more quantity can get a discount and buy at a lower unit price, while consumers with less quantity can only buy at the original price. We can often see the slogan of "buy two get one free" in shopping malls, which is also a manifestation of quantity discrimination. In my opinion, the reason for this kind of price discrimination is that shopping malls hope to attract more customers and increase sales volume. Maybe customers just want to buy one, but when they see that they can get three for the price of two, which is more cost-effective than buying one. Finally they will decide to buy two, which increases the sales of the product.

-- Discounts while bulk buying is also example of price discrimination. There is nothing called the quantity discrimination. Such price discrimination with bulk buying are examples of second degree price discrimination. The reward programs for frequent visitors also use the second degree price discrimination.

The second example is about prime time. Some attractions or the surrounding hotels will increase the price in the peak season and reduce the price in the off-season. Because the peak season is the prime time for tourism. There are a lot of tourists. Even if the price is increased, it will not affect the sales volume. Because there is always someone willing to pay that price. But in the off-season, there are few tourists. If the price is still very high, it will have a significant impact on the reduction of passenger flow. Only by reducing the price, can merchants attract customers and maintain operation.

-- Peak and off-peak time pricing is an example of third degree price discrimination which is based on elasticity of demand. During peak time, demand is inelastic and hence raising price does not reduce demand significantly so that revenue increases. On the other hand, off-peak demand is elastic and hence reducing price may increase demand and hence revenue can be improved.

I think price discrimination can help me make better profits. For example, when I went to McDonald's with my friends to buy ice cream. Originally, only I wanted to eat it. But we found that the second McDonald's ice cream was half price. If I only bought one, I would feel that I missed the half price and it was not cost-effective. At that time, we would choose two people to buy together. On average, the unit price is cheaper for us. But for McDonald's, it sold an extra ice cream, and the price was still higher than its cost, which increased the profit.

-- Yes, price discrimination helps monopolists to make more profit. Again, the example of McDonald you have mentioned is an example of second degree price discrimination.

Hope this helps. Thanks.