Arbitrage
a. Is the act of to buying low in one market and selling high in another market
b. Can force a seller to go back to uniform pricing
c. Can defeat direct price discrimination
d. All of the above
d
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Which of the following reasons explains how second-degree price discrimination works?
A. In order to get people to buy more of a good you typically have to lower the price because of the law of demand. B. The price of the good or service is what the consumers are willing and able to pay, which increases profits. C. People will buy more of a good when they have relatively inelastic demands for the good. D. Producers have increasing average total costs as they produce more of a good.
Consider the budget line in the above figure. If the consumer's income is $240, then the price of a book is
A) $20 per book. B) $24 per book. C) $12 per book. D) More information is needed to determine the price of a book.
An overall rise in prices in the economy is called:
A. core inflation. B. core deflation. C. inflation. D. deflation.
________ choose(s) the quantities of goods and services to produce, while ________ choose(s) the quantities of goods and services to buy
A) Firms; only households B) Households; the government C) Households; firms D) Firms; households and the government E) The government; firms