A firm has two customers with non-identical demands and a constant marginal cost of production. At any positive price, the consumer surplus values for the two customers are related as CS2 ? CS1
What can we say about the optimal two-part tariff for the firm? A) The firm sets the price equal to MC and the optimal tariff is equal to CS2.
B) The firm sets the price equal to MC and the optimal tariff is equal to CS1.
C) The firm sets the price equal to MC and the optimal tariff is equal to zero.
D) The optimal price is greater than MC and the optimal tariff is equal to CS1.
D
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Indicate whether the statement is true or false
Which of the following countries have instituted liberal reforms and substantially improved their economic freedom rating since 1990?
a. Japan and Italy b. Nigeria and Pakistan c. Sierra Leone and Zimbabwe d. Estonia and Hungary
Which of the following is not a central bank?
a. The Bank of England b. The Bank of Japan c. The Bank of America d. The Federal Reserve
One company has 90% of the market for cola soft drinks. An antitrust action against this company is likely to be defended (by the company) by the argument that
A. there is no substitute for cola soft drinks. B. the market share is not important. C. the relevant market is for cola soft drinks. D. the relevant market is not that for cola soft drinks but for all soft drinks.