... customer bargains directly with the seller to bring the price of a product down to one they find acceptable. Second-degree discrimination where the prices charged to consumers varies according the amount they purchase. This is commonly seen in the concept of bulk buying, when greater quantities bought results in lower prices. Third-degree discrimination operates when consumers are grouped into two or more separate markets with different prices in each market. This is the most common type of price discrimination, with student discounts, pensioner fares and child prices being good examples of this category. "If it is possible to discriminate, then it is profitable to do so" is a passing comment made by Philips (1983) p18, however, when given a number of separate markets with different identifiable demands, a discriminating pricing policy is at least as profitable as a non-discriminating one. By discriminating prices, producers are appealing to a wider section of the market, ...

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