FAISAL1818
Shweta, please cross-check your question. Price discrimination is not possible under perfect competition. This is because a firm cannot charge different prices for the identical product in the different segments of market. The reason for non-existence of price discrimination under perfect competition can be attributed to the following two features of perfect competitive market. 1. Firm is a price taker and not a price maker; hence, a firm has no control over the price of its product. 2. The product is identical and homogeneous in terms of shape, size, colour and feature. 3. Lastly, both the parties- buyers as well as sellers have perfect knowledge about the market conditions, hence, no single firm can charge buyers different prices. However, if it tries to do so, then it will end-up losing all its customers.
Hence, please cross-check your question and get back to us again.
Answers & Comments
1. Firm is a price taker and not a price maker; hence, a firm has no control over the price of its product.
2. The product is identical and homogeneous in terms of shape, size, colour and feature.
3. Lastly, both the parties- buyers as well as sellers have perfect knowledge about the market conditions, hence, no single firm can charge buyers different prices. However, if it tries to do so, then it will end-up losing all its customers.
Hence, please cross-check your question and get back to us again.