Under conditions of third-degree price discrimination, a firm:
Select one:
Will charge a price equal to the marginal cost.Will charge the highest prices to those customers with the least elastic demand.Will capture all of consumer surplus as profit for the firm.Will charge the highest prices to those customers with the most elastic demand.
A cartel will maximize profit when
Select one:
P>MRMC=MRP
According to kinked demand curve model, if a firm lowers its price, its competitors will _____.
Select one:
Increase their price because they don't have many competitorsLower their price to match the reduction.Produce more outputWait and expect to see their market share rise.
Which of the following is not the reason why cartels are unstable?
Select one:
Firms cannot foresee the price, which will lead to make wrong decision and low the profit.One of firms can earn more money by producing more than its output quota.Individual members may want to cheat.One firm's action will affect other firms.