Saturday, September 14, 2013

(Late) Thomas Ostrem Ch.1 Question 6

I found the concept "price discrimination" to be interesting and amusing. The concept that firms will choose to change the price of their goods/services depending on the person they are selling to seems really unfair to the consumer, but actually makes sense from the firm's point to view. I like the example about the price of air fare. Some people in the same row as you going to the same destination as you may have paid a significantly lower air fare price than you did. It seems odd, but when you look at the logic it makes sense to make more money from the customers that are willing to pay more money for the flight and at the same time hold on to customers that are dealing with a tighter budget. It made me think about how the means of buying products (air fare) could have an effect on the price that is offered to me. 

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