The Walt Disney Company is in a position to use a two-part tariff by charging for admission and also charging for rides inside its two theme parks, Disneyland and Disney World
Which of the following statements regarding Disney's pricing strategy is true?
A) At one time, customers had to pay for admission and rides at Disneyland and Disney World. Disney has since changed its pricing policy; it earns higher profits by charging for rides but not for admission.
B) At one time, fees for admission and rides at both parks were set at their profit-maximizing levels. Disney has since changed its pricing policy; it uses a cost-plus pricing strategy for admission and does not charge for rides.
C) At one time, customers had to pay for admission and rides at Disneyland and Disney World. Disney has since changed its pricing policy; it earns higher profits by charging for admission but not for rides.
D) At one time, admission fees were charged at both parks but all rides were free. Disney has since changed its pricing policy; it earns higher profits by charging for both admission and rides.
C
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Refer to Figure 2-4. A movement from X to Y
A) is the result of advancements in plastic production technology only, with no change in food production technology. B) could be due to a change in consumers' tastes and preferences. C) is the result of advancements in food production technology only, with no change in the technology for plastic production. D) could occur because of an influx of immigrant labor.
Which of the following is most likely to be allowed under World Trade Organization (WTO) rules?
A. Japan bans the importation of American rice because it is thought that American rice may not be as nutritious as Japanese rice. B. Great Britain outlaws non-British cars in an effort to reduce emissions in England, Scotland, and Wales. C. The United States decides to ban the consumption and production of cheese made from unpasteurized milk to guarantee that the food people eat is safe. D. The United States decides to ban the importation of foreign-made cigarettes, without putting any restriction on the sale of local cigarettes, to reduce lung cancer in the United States.
In using the Internal Rate of Return approach, one must first calculate the discount rate on the investment that makes
A) the net present value equal zero. B) the interest rate equal zero. C) the interest rate equal the discount rate. D) the first year's return positive.
Suppose there are four firms in an industry. The market shares of the four firms are 5 percent, 20 percent, 35 percent, and 40 percent. The Herfindahl-Hirschman index for that industry is
A. 1,250. B. 6,650. C. 100. D. 3,250.