Question 1

The case on textbook publishers shows that

Accepted Answer

A)  if imports are allowed, price discrimination is difficult or impossible. 
B)  if imports are allowed, price discrimination is possible. 
C)  publishers have a difficult time identifying the groups involved. 
D)  publishers should not migrate to electronic textbooks. 
A)  if imports are allowed, price discrimination is difficult or impossible. 
B)  if imports are allowed, price discrimination is possible. 
C)  publishers have a difficult time identifying the groups involved. 
D)  publishers should not migrate to electronic textbooks.

Question 2

Declining-block quantity discrimination makes sense if

Accepted Answer

A)  buyers of smaller quantities are more price sensitive than buyers of larger quantities. 
B)  buyers of smaller quantities are less price sensitive than buyers of larger quantities. 
C)  demand for the good is perfectly elastic. 
D)  the lower price for larger quantities encourages all consumers to purchase the larger quantity. 
A)  buyers of smaller quantities are more price sensitive than buyers of larger quantities. 
B)  buyers of smaller quantities are less price sensitive than buyers of larger quantities. 
C)  demand for the good is perfectly elastic. 
D)  the lower price for larger quantities encourages all consumers to purchase the larger quantity.

Question 3

In two-part pricing with identical consumers,a firm at least

Accepted Answer

A)  charges a lump-sum fee equal to the producer surplus. 
B)  sets unit price equal to marginal cost. 
C)  cannot maximize profit compared to single-price monopoly pricing. 
D)  Both A and B. 
A)  charges a lump-sum fee equal to the producer surplus. 
B)  sets unit price equal to marginal cost. 
C)  cannot maximize profit compared to single-price monopoly pricing. 
D)  Both A and B.

Question 4

-The above figure shows the market for a particular good.If the market is controlled by a perfect-price-discriminating monopoly,the deadweight loss equals

Accepted Answer

A)  C + E. 
B)  A + B + C. 
C)  C. 
D)  zero. 
A)  C + E. 
B)  A + B + C. 
C)  C. 
D)  zero.

Question 5

If you purchase one pound of apples the price is $1.50 per pound.If you buy a five pound bag of apples,the cost is $5.00.This is most likely an example of

Accepted Answer

A)  quantity discounts. 
B)  lower marginal cost. 
C)  lower marginal benefit. 
D)  price gouging. 
A)  quantity discounts. 
B)  lower marginal cost. 
C)  lower marginal benefit. 
D)  price gouging.

Question 6

To buy season tickets at the new Levi's Stadium,49ers fans have to buy a Personal Seat License (PSL)that then allows them to buy season tickets for the next 30 years.This is an example of

Accepted Answer

A)  why the NFL shouldn't have anti-trust exemptions. 
B)  two-part pricing, where the PSL is the lump-sum payment. 
C)  pure bundling pricing. 
D)  positively correlated pricing. 
A)  why the NFL shouldn't have anti-trust exemptions. 
B)  two-part pricing, where the PSL is the lump-sum payment. 
C)  pure bundling pricing. 
D)  positively correlated pricing.

Question 7

Firms price discriminate to maximize total revenue.

Accepted Answer

A) True 
 B)False

Question 8

Coupons represent a form of price discrimination because they offer a low-cost way for firms to

Accepted Answer

A)  identify customers with apparently more elastic demand and offer them a lower price. 
B)  retain loyal customers who are not price sensitive. 
C)  offer discounts to consumers who buy larger quantities. 
D)  perfectly price discriminate. 
A)  identify customers with apparently more elastic demand and offer them a lower price. 
B)  retain loyal customers who are not price sensitive. 
C)  offer discounts to consumers who buy larger quantities. 
D)  perfectly price discriminate.

Question 9

An electricity provider charges consumers $0.20 per kWh for the first 100 kWh,$0.25 per kWh for the next 50 kWh,and $0.27 per kWh for all subsequent kWH of usage.This would be considered

Accepted Answer

A)  an antitrust violation. 
B)  an example of increasing-block pricing. 
C)  bad business practices. 
D)  an example of three-part pricing. 
A)  an antitrust violation. 
B)  an example of increasing-block pricing. 
C)  bad business practices. 
D)  an example of three-part pricing.

Question 10

Which of the following is an example of pure bundling?

Accepted Answer

A)  a pair of pants 
B)  a pizza and beer lunch combo 
C)  an automobile 
D)  All of the above. 
A)  a pair of pants 
B)  a pizza and beer lunch combo 
C)  an automobile 
D)  All of the above.

Question 11

If a market is controlled by a perfect-price-discriminating monopoly,then

Accepted Answer

A)  a deadweight loss is generated. 
B)  there is no consumer surplus. 
C)  consumer surplus is the same as under perfect competition. 
D)  output is less than that of a single-price monopoly. 
A)  a deadweight loss is generated. 
B)  there is no consumer surplus. 
C)  consumer surplus is the same as under perfect competition. 
D)  output is less than that of a single-price monopoly.

Question 12

Consumers who place a high value on a good are better off with pricing in the following order: 1)________; 2)________; 3)________.

Accepted Answer

A)  competitive market; perfect price discrimination; single-price monopoly 
B)  competitive market; single-price monopoly; perfect price discrimination 
C)  single-price monopoly; competitive market; perfect price discrimination 
D)  Unable to determine. 
A)  competitive market; perfect price discrimination; single-price monopoly 
B)  competitive market; single-price monopoly; perfect price discrimination 
C)  single-price monopoly; competitive market; perfect price discrimination 
D)  Unable to determine.

Question 13

A firm that practices group price discrimination will set the lower price in the market that has the most elastic demand.

Accepted Answer

A) True 
 B)False

Question 14

A perfect price discriminator

Accepted Answer

A)  charges each buyer her reservation price. 
B)  charges different prices to each customer based upon different costs of delivery. 
C)  generates a deadweight loss to society. 
D)  charges lower prices to customers who buy greater quantities. 
A)  charges each buyer her reservation price. 
B)  charges different prices to each customer based upon different costs of delivery. 
C)  generates a deadweight loss to society. 
D)  charges lower prices to customers who buy greater quantities.

Question 15

A photograph processing machine company requiring customers who buy a processing machine to purchase chemicals and photographic paper from it is an example of

Accepted Answer

A)  bundling. 
B)  a requirement tie-in sale. 
C)  quantity discrimination. 
D)  a two-part tariff. 
A)  bundling. 
B)  a requirement tie-in sale. 
C)  quantity discrimination. 
D)  a two-part tariff.

Question 16

Firms use various methods for identifying customers such as ________ and ________.

Accepted Answer

A)  observable characteristics such as willingness to wait in long lines ; their actions such as early adoption 
B)  observable characteristics such as age; their actions such as willingness to wait in long lines 
C)  the color of their hair; whether or not they roll their eyes at high prices 
D)  None of the above. 
A)  observable characteristics such as willingness to wait in long lines ; their actions such as early adoption 
B)  observable characteristics such as age; their actions such as willingness to wait in long lines 
C)  the color of their hair; whether or not they roll their eyes at high prices 
D)  None of the above.

Question 17

The more block prices a monopoly can set instead of setting a single price,the

Accepted Answer

A)  smaller the deadweight loss. 
B)  the more producer surplus. 
C)  the larger the total welfare. 
D)  All of the above. 
A)  smaller the deadweight loss. 
B)  the more producer surplus. 
C)  the larger the total welfare. 
D)  All of the above.

Question 18

During a hot summer weekend,the only supermarket near the beach decides to charge consumers $6.50 for the first 12-pack of soda pop,$5.50 for the second and third 12-packs,and $5.25 for all subsequent purchases during the same shopping trip.This would be considered

Accepted Answer

A)  an example of declining-block pricing. 
B)  not very smart since consumers will buy soda pop regardless of the price. 
C)  an example of monopoly pricing. 
D)  an example of an inelastic demand curve. 
A)  an example of declining-block pricing. 
B)  not very smart since consumers will buy soda pop regardless of the price. 
C)  an example of monopoly pricing. 
D)  an example of an inelastic demand curve.

Question 19

Why might luxury-goods retailers limit purchases on a good by consumers "due to popular demand"?

Accepted Answer

A)  Because they are worried about running out of supply, leaving some of their customers unhappy that they can't buy the good. 
B)  Because they are trying to use scarcity as a way to improve the brand image of the good. 
C)  Because they are limiting the possibility of arbitrage, where consumers buy in a low price area and resell in a higher price area. 
D)  Because they are worried that they'll run out of the good during the all-important holiday season. 
A)  Because they are worried about running out of supply, leaving some of their customers unhappy that they can't buy the good. 
B)  Because they are trying to use scarcity as a way to improve the brand image of the good. 
C)  Because they are limiting the possibility of arbitrage, where consumers buy in a low price area and resell in a higher price area. 
D)  Because they are worried that they'll run out of the good during the all-important holiday season.

The case on textbook publishers shows that

Declining-block quantity discrimination makes sense if

In two-part pricing with identical consumers,a firm at least

-The above figure shows the market for a particular good.If the market is controlled by a perfect-price-discriminating monopoly,the deadweight loss equals

If you purchase one pound of apples the price is $1.50 per pound.If you buy a five pound bag of apples,the cost is $5.00.This is most likely an example of

To buy season tickets at the new Levi's Stadium,49ers fans have to buy a Personal Seat License (PSL)that then allows them to buy season tickets for the next 30 years.This is an example of

Firms price discriminate to maximize total revenue.

Coupons represent a form of price discrimination because they offer a low-cost way for firms to

An electricity provider charges consumers $0.20 per kWh for the first 100 kWh,$0.25 per kWh for the next 50 kWh,and $0.27 per kWh for all subsequent kWH of usage.This would be considered

Which of the following is an example of pure bundling?

If a market is controlled by a perfect-price-discriminating monopoly,then

Consumers who place a high value on a good are better off with pricing in the following order: 1); 2); 3).

A firm that practices group price discrimination will set the lower price in the market that has the most elastic demand.

A perfect price discriminator

A photograph processing machine company requiring customers who buy a processing machine to purchase chemicals and photographic paper from it is an example of

Firms use various methods for identifying customers such as and .

The more block prices a monopoly can set instead of setting a single price,the

During a hot summer weekend,the only supermarket near the beach decides to charge consumers $6.50 for the first 12-pack of soda pop,$5.50 for the second and third 12-packs,and $5.25 for all subsequent purchases during the same shopping trip.This would be considered

Why might luxury-goods retailers limit purchases on a good by consumers "due to popular demand"?

Introduction

Supply and Demand

Empirical Methods for Demand Analysis

Consumer Choice

Production

Costs

Firm Organization and Market Structure

Competitive Firms and Markets

Monopoly

Oligopoly and Monopolistic Competition

Game Theory and Business Strategy

Strategies Over Time

Managerial Decision-Making Under Uncertainty

Asymmetric Information

Government and Business

Global Business

Filters

Exam 10: Pricing With Market Power

The case on textbook publishers shows that

Declining-block quantity discrimination makes sense if

In two-part pricing with identical consumers,a firm at least

-The above figure shows the market for a particular good.If the market is controlled by a perfect-price-discriminating monopoly,the deadweight loss equals

If you purchase one pound of apples the price is $1.50 per pound.If you buy a five pound bag of apples,the cost is $5.00.This is most likely an example of

To buy season tickets at the new Levi's Stadium,49ers fans have to buy a Personal Seat License (PSL)that then allows them to buy season tickets for the next 30 years.This is an example of

Firms price discriminate to maximize total revenue.

Coupons represent a form of price discrimination because they offer a low-cost way for firms to

An electricity provider charges consumers $0.20 per kWh for the first 100 kWh,$0.25 per kWh for the next 50 kWh,and $0.27 per kWh for all subsequent kWH of usage.This would be considered

Which of the following is an example of pure bundling?

If a market is controlled by a perfect-price-discriminating monopoly,then

Consumers who place a high value on a good are better off with pricing in the following order: 1)________; 2)________; 3)________.

A firm that practices group price discrimination will set the lower price in the market that has the most elastic demand.

A perfect price discriminator

A photograph processing machine company requiring customers who buy a processing machine to purchase chemicals and photographic paper from it is an example of

Firms use various methods for identifying customers such as ________ and ________.

The more block prices a monopoly can set instead of setting a single price,the

During a hot summer weekend,the only supermarket near the beach decides to charge consumers $6.50 for the first 12-pack of soda pop,$5.50 for the second and third 12-packs,and $5.25 for all subsequent purchases during the same shopping trip.This would be considered

Why might luxury-goods retailers limit purchases on a good by consumers "due to popular demand"?

Introduction

Supply and Demand

Empirical Methods for Demand Analysis

Consumer Choice

Production

Costs

Firm Organization and Market Structure

Competitive Firms and Markets

Monopoly

Oligopoly and Monopolistic Competition

Game Theory and Business Strategy

Strategies Over Time

Managerial Decision-Making Under Uncertainty

Asymmetric Information

Government and Business

Global Business

Filters

Consumers who place a high value on a good are better off with pricing in the following order: 1); 2); 3).

Firms use various methods for identifying customers such as and .