Price Discrimination is a micro-economic strategy by which pricing is done for different products in different markets. The price depends on the production cost which again depends on fixed costs, variable costs etc.The price of the good is generally more than the production cost of the good. The various types of pricing are as follows:
1. First degree price discrimination
In this type of pricing, there is no particular price for the good, the price depends on the consumer's will to pay in order to avail the good. Example- Auctions
2. Segmented price discrimination
In this type of pricing, different pricing is done according to different market segments. Example- students get student passes for buses and railways. Similarly senior citizens get offers regarding traveling charges.
3. Selective price discrimination
In this type of price discrimination , pricing is done based on the consumer's ability to pay for a particular product. Example- Inox offers various prices according to customer needs or demands . Like Gold class, silver class and general class tickets.
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