Firms who are attempting to engage in price discrimination will offer customers with a ________ demand a higher price and customers with a(n) ________ demand a lower price.
A. lower; higher
B. normal; inferior
C. less elastic; more elastic
D. more elastic; less elastic
Answer: C
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If prices are held below the equilibrium price:
A) there exists a surplus in the market. B) there exists a shortage in the market. C) social surplus is maximized. D) all firms earn positive economic profits.
In the figure above, the initial demand curve is D0. There are no rent ceilings nor rent floors. The equilibrium monthly rent is
A) $100 per month. B) $200 per month. C) $300 per month. D) $400 per month.
Subprime borrowers ________
A) are those individuals who owe more on their mortgage than the value of their home B) possess a relatively low FICO score C) rely on mortgage-backed securities to support their mortgage applications D) are those with an income level below the value of their mortgage
The stock market provides two functions for corporate financing: reducing investors' risk and setting the prices of stocks
a. True b. False Indicate whether the statement is true or false