A group price discriminator sells its product in Florida for three times the price it sets in New York. Assuming the firm faces the same constant marginal cost in each market and the price elasticity of demand in New York is -2.0, the demand in Florida
A) has an elasticity of -6.0.
B) is more price elastic than the demand in New York.
C) has an elasticity of -1.2.
D) has an elasticity of -0.67.
C
You might also like to view...
Marginal revenue is
a. the change in total revenue obtained by selling an additional unit of output b. average revenue per unit of output c. the change in total revenue per unit of cost d. total revenue divided by average revenue e. average revenue divided by marginal cost
Some goods can be produced at low cost only if they are produced in large quantities. This phenomenon is called
a. marginal cost of production. b. marginal benefit of size. c. economies of scale. d. economies of production.
An decrease in taxes shifts aggregate demand
a. to the right. The larger the multiplier is, the farther it shifts. b. to the right. The larger the multiplier is, the less it shifts. c. to the left. The larger the multiplier is, the farther it shifts. d. to the left. The larger the multiplier is, the less it shifts.
If income increases, then the:
A. budget line shifts to the right. B. budget line rotates clockwise. C. opportunity set contracts. D. budget line rotates counterclockwise.