A perfectly price discriminating monopolist will

a. sells more units than it would if it could not price discriminate

b. decrease consumer surplus by price discriminating

c. lose profits if it sets fewer prices

d. all of the above

e. none of the above

The correct option is d. all of the above

Explanation:

Monopolist practices price discrimination for the following reasons:

1. A monopolist can sell more units by charging lower prices to the poor and by charging higher prices to the people who are ready to purchase the product at a higher price.

2. A monopolist can use price discrimination to increase producer surplus by removing most of the consumer surplus.

3. A monopolist may incur a loss if he charges lower prices than the equilibrium price level from each consumer.