Microeconomics

If a firm sells to two distinct identifiable markets and resale is imp

If a firm sells to two distinct identifiable markets and resale is impossible, why is price discrimination more profitable than setting a single price? What will be an ideal response?   ANSWER If the firm charges a single price on the two different markets, marginal revenue in one market will exceed marginal revenue in the […]

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Date: September 9th, 2020

A mail-order clothing company offers a discount if customers purchase

A mail-order clothing company offers a discount if customers purchase two shirts instead of only one. This is necessarily an example of quantity discrimination. Indicate whether the statement is true or false   ANSWER False. The shipping cost per item is less for two shirts than for one. This cost difference may explain the discount. […]

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Date: September 9th, 2020

After analyzing his opponent, a tennis player decides to serve 10% of

After analyzing his opponent, a tennis player decides to serve 10% of his serves to the left, 50% of his serves to the right, and 40% of his serves at the body of his opponent. This illustrates a A) deterministic strategy. B) dominant strategy. C) mixed strategy. D) non-game theoretic problem.   ANSWER C  

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Date: September 9th, 2020