In the Schweser notes, it explains that in a perfect price discrimination scenario, it could actually increase allocative efficiency, as a greater quantity could be produced. I got a question wrong on a mock exam (7 City) because I chose that is increased effeciency (the answer was decreased). I guess we’re to assume that it’s not perfect price discrimination? In hindsight, of course that makes sense.
Can you post the question?
Price discrimination occurs when a producer charges ____ consumers _____ prices for the same product. It _____ allocative inefficiency by enabling _____ quantities of goods to be supplied. (The answer is diferent, differing, increase, greater.