A price-discriminating monopolist with two markets will equate
A) the prices of two markets.
B) price and marginal revenue in each of the two markets.
C) marginal revenue and marginal cost in each of the two markets.
D) average revenue and marginal revenue between the two markets.
Answer: C
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In 2007, European Union (EU) negotiators have offered to cut tariffs for Latin American bananas to avoid "banana wars". What are the effects of a cut in tariffs?
A) The quantity of bananas imported into the EU will increase. B) The price of bananas for consumers will increase. C) The quantity of bananas produced in the EU (such as in France and Spain) will increase. D) Europe will start to export bananas.
The table above gives some of the entries in the national income and product accounts. What is the value of exports?
A) $350 billion B) $300 billion C) -$25 billion D) $25 billion
Which of the following statements about the Herfindahl-Hirschman Index is CORRECT?
I. It is the square of the percentage market share of each firm summed over the largest 50 firms (or summed over all the firms if there are fewer than 50 ) in a market. II. A small index is indicative of a high degree of competition. III. The index is used to measure the degree of competition. A) I only B) I, II only C) I, III only D) I, II, and III
In 1980, in order to stimulate agricultural production, Fidel Castro allowed Cuban farmers to sell their goods directly to consumers and keep whatever profit they made. Some farmers were earning $50,000 per year, compared with the average worker income of $2,400 . The workers resented this. Castro denounced the farmers as "capitalist gangsters" and closed the free markets. Cuban cash income
declined five percent and fresh vegetables were in short supply. This illustrates the economic concept of the a. law of comparative advantage. b. equality-efficiency trade-off. c. cost disease of the service sector. d. unemployment-inflation trade-off. e. All of the above are correct.