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The authors of this article propose a simple exercise of monopoly pricing to illustrate complex theoretical results on the welfare effects of group pricing. By exposing students to this exercise, they aim to bridge a gap between the standard textbook analysis of group pricing and more general results in the literature and clarify some students’ misconceptions. They gear the exercise toward undergraduate students in principles and intermediate-level economics, microeconomics, and industrial organization courses.

Price discrimination: Teaching new results with simple exercises