Phlips International makes widgets, and nothing but widgets. Each widget is produced the exact same way, rolls off the assembly line and is packaged exactly the same way. They only make and sell one model of widget, and they always charge the same price: $100. Nobody ever pays a different price, and anyone can buy them. Yet Phlips is practicing price discrimination when they sell this widget to customers. How can this be?

[UPDATE:  Forgot to mention they produce at constant returns to scale]

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