64 740
Assignments Done
99,3%
Successfully Done
In September 2018

Answer to Question #56744 in Microeconomics for akib

Question #56744
Fast-food stores often charge higher prices for their products in high-crime areas than they charge in low-crime areas. Is this an act of price discrimination? Why or why not?
Expert's answer
Firstly, we need to define term ‘price discrimination’. Price discrimination is a pricing strategy when identical (similar) goods or services are transacted at different prices. The main task of price discrimination is to take maximum payment (or near maximum) for the good/service that consumer can pay. In the case of fast-food stores in high-crime areas, in my strong opinion, risk fee is included in product price. As a result, prices are higher than their average level.

Need a fast expert's response?

Submit order

and get a quick answer at the best price

for any assignment or question with DETAILED EXPLANATIONS!

Comments

No comments. Be first!

Leave a comment

Ask Your question

Submit
Privacy policy Terms and Conditions