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Price Discrimination
The practice of charging different prices for the same good or service based on customers' willingness to pay or sensitivity to price
Marginal Revenue
The additional revenue generated from selling one more unit of a product
Willingness to Pay
A customer's maximum price for a good or service
Price Elasticity of Demand
The responsiveness of the quantity demanded to changes in price
Volume Discounts
A strategy offering lower prices for larger quantities of a product
Freemium Model
Offering a basic version of a product for free and a premium version for a fee
Deadweight Loss
The loss in total surplus due to market inefficiency
Natural Monopoly
A market where a single firm can supply the entire demand at a lower cost than multiple firms due to economies of scale
Public Ownership
Giving the government control over monopolies to set fair prices and ensure public interest
X-Efficiency
A regulatory approach allowing monopolies to retain some profits from cost reduction to encourage innovation
Horizontal Merger
Two firms in the same industry merge to increase market share
Vertical Merger
Two firms at different production stages merge
Market Failure
Occurs when a real economy falls short of an ideal economy due to inefficiencies
