First degree price discrimination is often seen as the most effective as it is determined by a customer's willingness to pay for the good. It is sometimes called perfect price discrimination as an individual seller can price each good or service differently for each customer.

For example consider used car dealers, te second hand market for tickets to sporting and music events, and also sellers of sunglasses t tourists in holiday spots. There are no prices on the goods in the latter examples and the seller can negotiate with each individual to find their willingness to pay.