Final answer:
Price discrimination is the term used when you divide people into two or more groups and assign them to different demand curves. It allows sellers to charge different prices to different buyers based on factors such as their willingness to pay or level of demand. Airlines often practice price discrimination by charging different fares for the same flight based on variables like time of purchase or loyalty status.
Step-by-step explanation:
Price discrimination is the term used when you divide people into two or more groups and assign them to different demand curves. It occurs when a seller charges different prices to different buyers for the same product or service based on factors such as their willingness to pay or their level of demand. This practice allows sellers to capture more consumer surplus and maximize their profits.
For example, airlines often charge different fares for the same flight based on factors like the time of purchase, the day of travel, or the passenger's loyalty status. By segmenting the market and offering different prices to different groups, airlines can extract more value from each customer.
Therefore, the correct answer is B) Price discrimination.