Suppose a Firm Produces Identical Goods for Two Separate Markets

question 111

Multiple Choice

Suppose a firm produces identical goods for two separate markets and practices third-degree price discrimination. In the first market the firm charges $30 per unit, and it charges $22 per unit in the second market. Which of the following represents the ratio of price elasticities of demand in the two markets?

• A) E2 = (21/29)E1
• B) E2 = (29/21)E1
• C) E2 = E1
• D) E2 = (22/30)E1
• E) none of these

Distinguish between special senses and general senses based on receptor location and function.

Understand the types and mechanisms of taste receptors, including their sensitivities.

Differentiate between the structures and functions of olfactory and taste receptor cells.

Recognize the neural pathways for taste and olfaction, including associated cranial nerves.

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Definitions:

Credit Cost Curve

The relationship between the cost of credit for a borrower and the default risk of the borrower, indicating how the cost of borrowing money increases with higher risk.

Collection Policy

Guidelines and procedures a company follows to collect payments from customers including when and how collections are pursued.

Aging Schedule

An aging schedule is a method used in accounting to categorize accounts receivables based on the length of time an invoice has been outstanding, aiding in the management of a company's debts.

Cash Discount

A deduction that a payer can take from the invoice amount if payment is made within a specified period.