🏷️ LIMITED TIME OFFER: GET 20% OFF GRADE+ YEARLY SUBSCRIPTION →
Log in
Economics
2
answers
0
watching
52
views

Which of the following is true of price discrimination as a part of international pricing strategy?

A. The more competitors there are, the lesser consumers bargaining power will be

B. The more competitors there are, the less likely consumers will be to buy from the firm that

C. A firm may charge a higher price for its product in a country where competition is limited than

D. Many competitors cause low elasticity of demand.

E. If a firm raises its prices above those of its competitors, consumers will refuse to switch to the

Watch
2
answers
0
watching
52
views

For unlimited access to Homework Help, a Homework+ subscription is required.

Unlock all answers

Get 1 free homework help answer.
Already have an account? Log in
Share
Alice Sejake
Alice SejakeLv10
21 Mar 2021
Already have an account? Log in
Share

Related textbook solutions

Principles of Economics
2nd Edition, 2017
Openstax
ISBN: 9781947172364
Principles of Macroeconomics
2 Edition,
Openstax
ISBN: 9781947172388
Principles of Microeconomics
2 Edition,
Openstax
ISBN: 9781947172340

Related questions

Question 1

The amount of profit that can be achieved using uniform pricing is __________ the profit that can be achieved from price discrimination because of _______.

Select one:

a. greater than; the cost of trying to determine every single consumer's individual demand (willingness to pay) is prohibitively expensive.

b. less than; uniform pricing is more costly so the ATC and AVC curves are higher than they are under price discrimination.

c. equal to; the TR and TC curves are equivalent under either pricing scheme, so there is no profit advantage to either scheme.

d. less than; total demand includes people who would be willing to pay more than, as well as less than, the uniform market price.

Question 2

A firm selling in two markets is practicing price discrimination:

Select one:

a. when it refuses to sell the good to some group of consumers.

b. anytime it charges different consumers different prices.

c. when it charges the same price to different consumers as long as they differ in their demand for the good.

d. when it is charging different consumers, different prices, and the price difference is not based upon cost differences.

Question 3

To successfully practice price discrimination:

Select one:

a. consumers in two separate markets must have identical demand.

b. the firm must possess market power.

c. it must be easy for consumers in one market to sell to consumers in the other market.

d. the firm must be a pure monopoly.

Question 4

If it could practice first-degree price discrimination, a firm with market power could earn:

Select one:

a. its typical monopoly profit as well as the area which, under uniform pricing, would represent the deadweight loss associated with market power.

b. an area half the size of its monopoly power under uniform pricing.

c. its typical monopoly profit as well as the area which, under uniform pricing, would represent consumer surplus.

d. its typical monopoly profit as well as the area which, under uniform pricing, would represent consumer surplus and the deadweight loss associated with market power.

Discuss until July 15, 2018. After the deadline, this link will close.


1. Suppose a firm is operating in a competitive market and is maximizing profit by producing at the point where marginal revenue equals marginal cost. Now suppose that consumer wealth decreases in this market (and the good is a normal good). What might you expect to happen to the profit-maximizing output quantity for the firm?


2. In what ways are profit-maximizing and loss-minimizing the same? In what ways are they different?

3. Suppose that De Beers and the local water utility are both monopolists, in the markets for diamond jewelry and water, respectively. If both monopolies decided to raise prices 15 percent, which monopoly would be more likely to see its total revenue decrease? Why?


4. Until the 1980s, AT&T held a monopoly over the national market for phone services. Suppose that AT&T argued that it was a natural monopoly, because the fixed cost of creating a nationwide phone network generated huge economies of scale, and that there was therefore no welfare loss associated with its monopoly. Counter this argument by explaining how even a natural monopoly causes deadweight loss.

5. Explain why an oligopolist (with few competitors) pays more attention to what its competitors are doing than a producer in a competitive market (with many competitors) does.


6. Given that the market for smartphones is inefficient, explain why consumers of smartphones might not want the price to be regulated.

When a monopoly lowers its price to increase quantity,

a. The quantity produced drives down marginal revenue

b. It will increase its profits

c. It will make less money on the units it would have orginally sold

d. It is not maximizing its profit

Which of the following statements is TRUE?

a. Both A and B

b. A monopoly can charge whatever it wants

c. Profit maximizatin occurs by setting price first

d. A monopoly cannot set price and quantity such that the point lies above the demand curve

A monopoly that is maximizing profits operates is the _______ portion of the demand curve

a. Unitary elastic

b. Horizontal

c. Elastic

d. Inelastic

A monopoly shuts down when,

a. The long run price is below its average variable cost

b. Never, because it can raise its prices as high as necessary to keep operating and maximizing profits

c. The short run price is below its average variable cost

d. The average cost is less than price

The ability of a monopoly to charge a price that exceeds marginal cost depends on,

a. Shape of the marginal cost curve

b. The price elasticity of supply

c. Price elasticity of demand

d. Slope of the demand curve

Which of the following could create a cost advantage for a monopoly?

a. Lower friction due to better organization

b. Better technology

c. All of the above

d. Standardization

Price discrimination,

a. Is illegal in the U.S.

b. Is when consumers use prices to discriminate between different quality products

c. Is a form of pricing where consumers pay different prices for a good

d. Allows firms to set a single intermediate price between consumers' low and high willingness to pay

Which of the following is likely hardest to resell?

a. The free facial you won at a raffel

b. An apple iPod

c. A coupon for a free haircut

d. A discount airline tickey you bought with your frequent flyer miles

If a monopoly charges higher prices to consumers who buy smaller quantities than to consumers who buy larger quantities; then,

a. Consuers who buy larger quantities have a higher price elastiity of demand

b. Consumers who buy smaller quantities have a lower price elasticity of demand

c. Both A and C

d. Consumers who buy larger quantities have a lower price elasticity of demand

Purchasing a season pass t the local symphony,

a. Is an example of third degree price discrimination

b. Is an example of second degree price discrimination

c. Is an example of first degree price discrimination

d. All of the above

Weekly leaderboard

Home
Homework Help 3,900,000
Economics 400,000
Start filling in the gaps now
Log in