Which case below best represents a case of third-degree price discrimination?
A. A professional baseball team pays two players with identical batting averages different salaries.
B. A utility company charges less for electricity used during "off-peak" hours, when it does not have to operate its less-efficient generating plants.
C. An insurance company offers discounts to safe drivers.
D. A major airline sells tickets to senior citizens at lower prices than to other passengers.
Answer: D
You might also like to view...
Sam has $200 a month to spend on either tanning sessions or rounds of golf. Tanning sessions are $20 each, and a round of golf is $50. A point on Sam's budget constraint would be:
A. 20 tanning sessions and 8 rounds of golf. B. 10 tanning sessions and 5 rounds of golf. C. 10 tanning sessions and 4 rounds of golf. D. 10 tanning sessions and 2 rounds of golf.
The decision of Russia to embark on perestroika reforms came under:
a. Yeltsin b. Putin c. Brezhnev d. Gorbachev e. none of the above
Periods of unusually low production in an economy result in ________ unemployment.
A. structural B. cyclical C. environmental D. frictional
One prediction about monopolistic competition is that it has higher unit costs than perfect competition. But it is unreasonable to conclude that monopolistic competition is therefore bad for consumers because
A) consumers benefit from an increased variety of products. B) higher production costs means more employment. C) consumers benefit from products becoming more homogeneous. D) consumers benefit from lower prices. E) consumers benefit because of an increase in quantity available.