Economists cite some beneficial effects of price discrimination. What are these benefits and how do the antitrust laws treat price discrimination?
What will be an ideal response?
Benefits include the ability to sell a product at a low price to low-income consumers, while charging a higher price to high-income consumers. Even the wealthy may pay less than if discrimination were disallowed, since profits in the low-income market might permit a lower price in the high-income market. The Robinson-Patman Act (1936) and the Clayton Act (1914) generally discourage price discrimination.
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The short-run aggregate supply curve is upward sloping because
A) a lower price level creates a wealth effect. B) lower taxes motivate people to work more. C) money wage rates do not immediately change when the price level changes. D) most business firms operate with long-term contracts for output but not labor.
How does the political system of a country affect its economic performance? a. The political state dictates what will be produced and how it will be produced for many LDC countries and the success of their economies depends upon the success ofthe political leaders in mobilizing the resources of the economies
b. Political revolution is creative in the same way that technological change is creative in the economic system, and these creativities spark the economy's economicperformance. c. The right to vote is equivalent to consumer sovereignty, which is the right to choose one's consumption and employment. d. Political honesty, such as one law for all, helps the poor and they are the backbone of an economy's production. e. Political stability is a prerequisite for long-term investment.
U.S. baby boomers are beginning to retire and withdraw their savings for retirement. What effect should we expect this to have on equilibrium price and quantity of financial assets?
A. Price rises and quantity also rises. B. Price falls and quantity also falls. C. Price rises and quantity falls. D. Price falls and quantity rises.
Which of the following is a pure public good?
a) a library book b) public transportation c) the judicial system d) an interstate highway e) all of the above