Price discrimination exists:
A. only in perfectly competitive markets.
B. because sellers try to exploit differences in customers’ willingness to pay.
C. in all industries, regardless of market structure.
D. only when demand is inelastic.
B. because sellers try to exploit differences in customers’ willingness to pay.
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Because of the flaws of the concentration ratio as a measure of the extent of competition in an industry, some economists prefer another measure of competition, the Herfindahl-Hirschman Index
Indicate whether the statement is true or false
Which of the following would cause an increase in the market supply of mountain bikes?
A) a decrease in the demand for mountain bikes B) an increase in taxes levied on mountain bike manufacturers C) an increase in the cost of components used to assemble mountain bikes D) an increase in the number of firms making mountain bikes
If an action creates more total benefits for gainers than total harm to losers,
a. that action would be a Pareto improvement. b. taking that action would improve efficiency c. the government should step in to take that action d. a side payment exists that would make the action a Pareto improvement e. any side payment would make the action inefficient
A television station reports that the price of orange juice has declined but the quantity sold has increased. This situation would be caused by a(n):
a. Increase in demand b. Increase in supply c. Decrease in supply d. Decrease in demand