It primarily refers to a practice of charging different price from different segments of a market. For example, half ticket price in amusement parks for children below 12.
It also implies that monopolist is in the position to separate the total market into two or more sub markets.
Price elasticity of demand must be different in each of the sub markets.
Consumers of low priced market should not resell the products in high priced market.
Consumers of high priced market should not purchase any products from low priced market.
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