There are three types of price discrimination.

1. First-degree price discrimination: This is when a seller charges each customer the maximum price they are willing to pay for a product or service. This type of price discrimination is the most efficient for the seller, as they capture all consumer surplus.

2. Second-degree price discrimination: This is when a seller charges different prices based on the quantity or quality of the product purchased. For example, a seller may offer discounts for buying in bulk or for purchasing a premium version of a product.

3. Third-degree price discrimination: This is when a seller charges different prices to different customer segments based on their willingness to pay. This type of price discrimination is commonly used in industries such as airlines, where prices vary based on factors such as time of booking, demand, and customer demographics.

First-degree, second-degree, and third-degree price discrimination