Price-discriminating firms that sell in two markets will charge higher prices in the market, ceteris paribus,
A. With a higher positive cross-price elasticity of demand with respect to substitutes.
B. With lower incomes.
C. With the more price-inelastic demand.
D. With the more income-elastic demand.
Answer: C
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Assume someone organizes all farms in the nation into a monopoly. As a result, consumer surplus will
A) not change. B) increase. C) decrease. D) either increase, decrease, or not change depending if the monopoly's marginal revenue curve lies below, above, or is the same as its demand curve. E) None of the above answers is correct because the effect on consumer surplus depends on whether the monopoly is a single-price or a price-discriminating monopoly.
The current exchange rate system in the United States is best described as a
A) silver standard. B) fixed exchange rate system. C) managed float exchange rate system. D) gold standard.
The returns to scale of the production function Q = 50 L0.4 K0.2 are
A) 50. B) .6. C) .8. D) 500.6.
In some countries it is time consuming and costly to establish ownership of property. Reforms to reduce these costs would likely
a. have no affect on either real GDP nor productivity b. raise real GDP and productivity. c. raise real GDP but not productivity. d. raise productivity but not real GDP.