Publishers have traditionally sold textbooks at different prices in different areas of the world. For example, a textbook that sells for $70 in the United States might sell for $5 in India. Although the Indian version might be printed on cheaper paper and lack color illustrations, it provides essentially the same information. Indian customers typically cannot afford to pay the U.S. price.
a. Using the theory of price discrimination carefully analyze the given scenario to explain this differential pricing strategy.
b. If the publisher decides to sell this textbook online, what problems will this present for the pricing strategy? How might the publisher respond?