A firm that charges a very low price would be practicing predatory pricing if
A. the price allowed only a small profit.
B. the price would only be profitable if it succeeded in driving a rival out of the market and prices increased afterward.
C. the price allowed profits that were positive but below those earned by other firms.
D. it only offered the low price to its rivals’ customers.
Answer: B
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An increase in interest rates results in a(n) ________ in the required rate of return to hold stocks and ________ current stock prices.
A. decrease; reduces B. decrease; raises C. increase; reduces D. increase; raises
Which of the following would shift the supply curve to the right?
A) A rise in the expected future price of the good B) A rise in the costs of producing the good C) Fewer producers in the industry D) All of the above. E) None of the above.
Purchasing power parity is used to estimate equilibrium:
A. inflation rates. B. exchange rates. C. price levels. D. interest rates.
A union-sponsored television campaign urging U.S. consumers to "Look for the union label" is designed to
A) increase the productivity of union labor. B) increase the derived demand for union labor by shifting consumer preferences in favor of union-made goods. C) raise wages by restricting the supply of union workers. D) remind consumers that if they do not buy union-made goods, unions will strike.