- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 9. The Firm and Market Structures
- Subject 6. Price Discrimination
CFA Practice Question
Which practice(s) is (are) price discrimination?
II. Airline tickets are extremely expensive if you purchase them at the last minute.
I. Meals in New York City cost more than meals in a small town.
II. Airline tickets are extremely expensive if you purchase them at the last minute.
Correct Answer: II
User Contributed Comments 6
| User | Comment |
|---|---|
| aakash1108 | II is Price discrimanation. The customer coming at the last minute is different from the customer coming a week before the flight. |
| endlessyy | But 1. could be differentiated from the customers in New York and the ones in Small town? Why it is incorrect? |
| granbois | about 1: that's because the costs are different so the prices are different. For 2, the cost is the same for all customers. |
| kumru | 1st is not wrong! this is price discrimination under third degree! given in notes, |
| myron | I is not a clear cut. Normally it's the supply and demand that determines the price. If it's from the same supplier, and costs are the same (which is unlikely), then it is a price discrimination. |
| chen511 | Thanks for explaining. |