Price discrimination

                 So what is the price discrimination? Let suppose you are a seller and you have a product and you want to maximize your profit. So what you will do, generally you will say, you will increase the price. But if you increase the price, it will be higher for some group and ok for some group. For those, the price is high they will change to the alternative product and your customer base will decrease so as to maximize profit what will you do. So sometimes we are selling the same product with a different price range to a different customer and this is called price discrimination, selling of the same product with a different price to different people.  

            Before price discrimination the company should know the different market segment such as domestic, industrial, educational etc. Like HP laptop producing the same laptop for school edition with a low price and with a different price for the normal user with different feature. Let's take the example of the airline . They are also doing price discrimination, like the customer buying ticket several months before paying less for the same ticket and the customer who is buying the ticket at the last minute are paying a high rate. Sometimes they increase the ticket price when the particular plane is in demand and sometimes when the ticket remains unsold they reduce the price.