Answer the following statements true (T) or false (F)
1) If no consumer surplus exists in a market, it is possible for a firm to earn greater profits.
2) In first-degree price discrimination, the firm's marginal revenue curve is equal to its demand curve.
3) In third-degree price discrimination, the price markup is smaller in the markets that are less responsive to price changes.
4) In third-degree price discrimination, consumer groups with the largest price elasticity of demand will pay the lowest price compared to the consumer groups with smaller price elasticities.
5) If the own price elasticity of demand for a firm's product is the same across all consumers, it is not possible for the firm to practice third-degree price discrimination.
1) FALSE
2) TRUE
3) FALSE
4) TRUE
5) TRUE
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When consumers' incomes increased 10 percent, the quantity of milk bought increased 5 percent. This result means
A) the demand for milk is income elastic. B) milk is a necessity. C) milk is a luxury. D) milk is an inferior good.
To prevent radio interference and crowding of geostationary satellites, governments are working to replace the earlier first-come first-served system with auctions that will allocate equipment and radio frequencies to high bidders
Indicate whether the statement is true or false
The prospect of a recession in the United States would probably cause the dollar to
a. depreciate because interest rates would be expected to rise. b. depreciate because imports would be expected to rise. c. appreciate because imports would be expected to fall. d. appreciate because interest rates would be expected to decrease.
A new domestic industry with potential economies of scale is called a(n):
A) potential business entrant. B) immature industry. C) infant industry. D) highly valued entrant.