The correct answer is: C. monopoly
Price discrimination is the practice of charging different prices for the same good or service to different consumers. This can be done based on a variety of factors, such as the consumer’s willingness to pay, the cost of production, or the level of competition.
Price discrimination can be a very effective way to increase profits. By charging different prices to different consumers, a firm can capture more of the consumer surplus. This is the difference between the maximum price that a consumer is willing to pay for a good and the price that they actually pay.
Perfect competition is a market structure in which there are a large number of firms selling identical products. In this type of market, firms have no power to set prices, and they must accept the market price. As a result, price discrimination is not possible in perfect competition.
Monopolistic competition is a market structure in which there are a large number of firms selling differentiated products. In this type of market, firms have some power to set prices, but they are not able to completely control the market price. As a result, price discrimination is possible in monopolistic competition, but it is not as effective as it is in monopoly.
A monopoly is a market structure in which there is only one firm selling a good or service. In this type of market, the firm has complete control over the market price. As a result, price discrimination is the most effective way for a monopoly to increase profits.
Oligopoly is a market structure in which there are a small number of firms selling a good or service. In this type of market, firms have some power to set prices, but they are not able to completely control the market price. As a result, price discrimination is possible in oligopoly, but it is not as effective as it is in monopoly.
In conclusion, price discrimination is the most effective way for a monopoly to increase profits. This is because a monopoly has complete control over the market price. In contrast, price discrimination is less effective in perfect competition, monopolistic competition, and oligopoly.