Transactions costs refer to the costs incurred by parties when agreeing to and carrying out an exchange. Price discrimination is when different prices are charged to different customers for the same product when the price differences are not related to differences in costs. A two-part tariff is a pricing structure where consumers pay one fee for the right to purchase a good at a second per-unit price.

2. Transactions costs
 The costs in time and other resources that parties
incur in the process of agreeing to and carrying out
an exchange of goods or services.

3. Price discrimination
 Charging different prices to different customers for
the same product when the price differences are not
due to differences in cost.

4. Two-part tariff
 A situation in which consumers pay one price (or
tariff) for the right to buy as much of a related good
as they want at a second price.

5. Sources
 Hubbard, R., and Anthony O'Brien. Microeconomics
Fourth Edition . New York: Pearson, 2013. Print