Cost-plus pricing

a. is used only in oligopolistic market structures
b. simplifies pricing policy by adding a markup to average total cost
c. in actual practice leads to markups which are greater for more elastic demand curves
d. is likely to increase profits more than the use of marginal analysis
e. requires the firm to project the amount which will be sold and then "mark-up" the price based on average variable cost


E

Economics

You might also like to view...

Explain the differences between commodity money, representative commodity money, and partially backed representative commodity money

What will be an ideal response?

Economics

Discuss the differences between perfect and imperfect price discrimination and the benefits of each to a monopolist.

What will be an ideal response?

Economics

The worst drought in over 50 years has decimated crops of soy beans and corn in the United States. (Source: New York Times, August 10, 2012). Because the production of corn has decreased, prices are expected to increase by 25 percent

These data are insufficient for calculating the elasticity of demand because we also need to know the A) percentage increase in income. B) percentage increase in quantity. C) percentage decrease in quantity. D) increase in bushels per acre.

Economics

Refer to the above figure. Suppose the economy is at C. If the government tried to reduce the unemployment rate to 3 percent, the new long-run outcome will be at point

A) A. B) C. C) D. D) H.

Economics