The managers of Movies Plus, a large movie theater, want to practice third-degree price discrimination. The managers have learned that college students have an own price elasticity of demand of 1.5 for tickets at Movies Plus and adults have an own price elasticity of 1.2. If the managers have correctly determined the third-degree profit-maximizing price for adults is $15, what is the third-degree
profit-maximizing price to charge students?
A) $7.50 B) $8.50 C) $10.00 D) $13.50
A) $7.50
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Almost all economists agree that tariffs and import quotas
a. reduces general economic welfare. b. increases general economic welfare. c. have no effect on general economic welfare. d. stimulate a less than fully employed economy.
Beth, an American citizen, travels to Italy on vacation and buys an espresso machine to bring home. Her purchase increases a. Italy's GDP
b. Italy's GDP and U.S. GDP, since Beth spent dollars buying the machine. c. U.S. GDP since she will have the machine with her at home in the U.S. d. Neither U.S. nor Italy's GDP, since the product was bought in one country and used in another.
One of the characteristics of the cap-and-trade system is that
A. there is no way to ensure that pollution is reduced below some allowable total amount. B. it is more expensive than a command-and-control system. C. it is inflexible, and does not respond well to differences in the marginal cost of pollution reduction. D. it reduces the economic damage that would have been done by a command-and-control system.
When did the European Union become a common market?
What will be an ideal response?