A monopolist engages in price discrimination:

a. By charging the same price to all consumers,

b. By charging a lower price to consumers whose demand is more inelastic,

c. By charging a higher price to consumers whose demand is more inelastic,

d. By charging a lower price when marginal cost is higher.

A monopolist engages in price discrimination c. By charging a higher price to consumers whose demand is more inelastic.

When the price of elastic demand is inelastic, the quantity demanded a certain product has a lower rate to change when there is a change in the price level. When a market has an inelastic demand, the purchasing power of consumers will decrease less when there is an increase in the price level. This means that charging a higher price when demand is inelastic increases the profit earned. Charging the same price to all customers will not maximize the profit of a firm because some buyers are willing to purchase the same goods at a higher price and some at a lower price. Charging a lower price than the marginal cost will make the firm to incur losses.