If a firm is practicing third-degree price discrimination and is charging a price of $15 per unit to consumers in Group A and a price of $10 to consumers in Group B, which of the following is true?
A) Group B consumers have a greater price elasticity than Group A consumers.
B) Group B consumers are less responsive to price changes than Group A consumers.
C) Group A consumers have a greater price elasticity than Group B consumers.
D) Group B consumers have a lower price elasticity than Group A consumers.
A) Group B consumers have a greater price elasticity than Group A consumers.
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To find aggregate planned expenditures, which of the following must be added to consumption expenditure?
i. net exports ii. investment iii. government expenditure on goods and services A) i only B) ii only C) iii only D) i and ii E) i, ii, and iii
In third-degree price discrimination, markets with a larger price elasticity of demand are ________ responsive to price changes and are charged ________ prices than markets with a smaller price elasticity of demand.
A) less; lower B) more; higher C) more; lower D) less; higher
An outcome in which all players choose the best strategy they can, given the choices of all other players, is called:
A. a dominant strategy. B. collusion. C. a Nash equilibrium. D. the prisoner's dilemma.
Refer to Figure e. Brandon and Allie want to go on a date one summer evening. Allie is a Red Sox fan, while Brandon is a Mets fan. Both teams are playing that evening, but not against each other. Each would rather watch their favorite team, but neither can force the other to watch a particular game, and each is willing to suffer through the other's game if it means time together. What is the Nash equilibrium?
A. Allie watches the Red Sox, and Brandon watches the Mets.
B. Allie and Brandon both watch the Red Sox.
C. Allie and Brandon both watch the Mets.
D. Allie and Brandon both watch the Red Sox or Allie and Brandon both watch the Mets.