If each customer is sold a product at a different price, then the firm is practicing
A) perfect price discrimination.
B) second-degree price discrimination.
C) third-degree price discrimination.
D) product differentiation.
A
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The equilibrium wage
a. is the same in all labor markets b. occurs where the supply of labor curve begins to bend backward c. cannot be calculated because there are so many labor markets d. is determined by the market demand for labor and the market supply of labor e. is irrelevant because of unions
Which of the following may be explained by adverse selection?
a. When banks raise the interest rate on loans, high-risk applicants leave the market. b. When health insurance companies decrease insurance charges but increase deductibles, less healthy people are more willing to purchase insurance. c. As the cost of insurance rises, low-risk applicants reduce their coverage. d. Products are sold at prices that reflect their true value. e. Loan companies do not require down payments.
Which of the following is not an automatic stabilizer?
a. Forward-looking behavior b. Interest rates c. Imports d. Transfer payments e. Consumption spending
The Earned Income Tax Credit is a federal program that
A. provides cash assistance to the nonworking poor. B. provides in-kind assistance to minimum wage workers. C. provides cash assistance to firms that hire single mothers living in poverty. D. increases wages for the working poor. E. increases the wages of minorities.