Snowpeak Ski Resort offers a price for a lift ticket that is barely over its marginal cost, but the high equipment rental fee keeps generating big profits. Which pricing strategy is the management using?
A. Two-part pricing
B. Commodity bundling
C. Cross-subsidization
D. Price discrimination
Answer: C
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Starting from long-run equilibrium, an increase in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. lower; higher D. higher; potential
If marginal cost exceeds marginal revenue, a profit-maximizing monopolist will
a. restrict output to increase the price even higher. b. raise price and expand output to increase profit. c. lower price and expand output to increase profit. d. attempt to maintain this position because it is consistent with profit maximization.
Suppose the number of buyers in a market decreases. As a result, would the demand curve in this market shift to the right or to the left?
A risk-neutral person will invest in a project by examining if
A) the expected utility associated with the project is positive. B) the marginal utility associated with the project is positive. C) the expected net present value is positive. D) All of the above.