A purely competitive firm does not try to sell more of its product by lowering its price below the market price because:
A. Its competitors would not permit it
B. It can sell all it wants to at the market price
C. This would be considered unethical price chiseling
D. Its demand curve is inelastic, so total revenue will decline
B. It can sell all it wants to at the market price
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A hotel with market power charges customers who check in before 5:00 pm more than those who check in after 5:00 pm. Those who check in early are much more likely to use the hotel's pool
Explain why this price difference may not be price discrimination.
By the third quarter of 2011, U.S. households had accumulated $6.2 trillion in housing equity, which represents about 11 percent of their net worth. What proportion of U.S. households own their home?
A. one-third B. one-half C. two-thirds D. three-fourths
Which is an example of market size affecting demand?
a. Restaurant visits drop after a hurricane causes a city to be evacuated. b. A computer chip maker moves to a town and hires hundreds. c. After a team wins the World Series, it becomes a fad to buy their caps. d. Sales of potato chips drop after the price of pretzels falls by half.
A ______ can be viewed as a negative tax.
a. surplus b. deadweight loss c. subsidy d. supply curve