Firms that engage in price discrimination
A. will earn less profit than those that do not discriminate.
B. will earn more profit than those that do not discriminate.
C. are biased against certain buyers in the market.
D. will always produce less output than firms that do not discriminate.
Answer: B
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Scherer (1970) provides which of the following argument(s) to explain the appearance of antitrust laws?
(a) Many farmers believed that the growth of big business came at the expense of growth in agriculture. (b) Many ordinary individuals with moderate or low incomes were envious of the fame and wealth accumulated by the relatively few industrial entrepreneurs. (c) Falling costs in transportation resulted in growth of the optimal size of the firm. (d) All of the above.
Suppose the production of cotton causes substantial environmental damage because the pesticides used by cotton farmers often make their way into nearby rivers and streams, and are very harmful to fish and other wildlife. Economists would consider the environmental damage that results from the production of cotton to be a(n):
A. relevant cost of production only if the environmental damage negatively affects other firms. B. relevant cost of production only if cotton farmers are charged a fine for the damage done. C. relevant cost of production. D. implicit cost of production that cotton farmers will take into account when determining their profit-maximizing level of output.
In the Keynesian-cross model, if government purchases increase by 100, then planned expenditures ______ for any given level of income.
Fill in the blank(s) with the appropriate word(s).
________: the level of output per unit of input
Fill in the blank(s) with correct word