Under second degree price discrimination, the average price per unit paid by high demand consumers is not equal to marginal willingness to pay for one additional unit.
Answer the following statement true (T) or false (F)
True
Rationale: Under second degree price discrimination, this average price includes a per-unit price equal to marginal cost plus some fixed fee equal to a portion of the consumer surplus for high type consumers. The quantity for high demand consumers arises where MC intersects demand -- i.e. the marginal willingness to pay is MC.
Economics
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