Limit pricing occurs when a firm sets price:
A. equal to marginal cost.
B. equal to average cost.
C. at different amounts for different groups of consumers.
D. so low that other firms are prevented from entering the market.
Answer: D
You might also like to view...
A labor contract provides for a first-year wage of $10 per hour, and specifies that the real wage will rise by 3 percent in the second year of the contract. The CPI is 1.00 in the first year and 1.07 in the second year. What dollar wage must be paid in the second year?
A. $10.90 B. $10.70 C. $11.02 D. $10.30
The above figure shows the marginal benefits and marginal costs of a college education. What is the amount of the external benefit in the figure?
A) $0 B) $5,000 C) $10,000 D) $15,000
An upturn in business confidence may cause firms to ________ their estimates of MPK, leading to a ________ capital stock that matches MPK to the user cost of capital and thus ________ of net investment
A) lower, larger, a contraction B) lower, larger, an expansion C) lower, smaller, a contraction D) raise, smaller, a contraction E) raise, larger, an expansion
"Anticompetitive practices" are actions by a powerful firm that:
a. threaten to destroy competitors b. force competitors to compete less vigorously c. prevent the entry of new rivals. d. all of these are true.