Lessons Learned

• You should charge price-sensitive customers less than other buyers.

• To price discriminate, you need to find a mechanism to exclude some customers from discounts given to others.

• To price discriminate, you need to identify which customers are the most price sensitive or devise a mechanism by which price-sensitive customers self-select.

• You can’t use bundling to extend a monopoly, but you can use it to increase your profits by evening out how much different customers value your products.