Which of the Following Statements About Price Discrimination Is False

question 132

Multiple Choice

Which of the following statements about price discrimination is false?

• A) All forms of price discrimination are illegal.
• B) Charging less for a second pizza that is identical to the first is an example of price discrimination.
• C) Price discrimination is a method for a seller to capture some consumer surplus.
• D) Compared to a single-price monopoly, the number of units sold increases when a monopoly price discriminates.
• E) Price discrimination increases a monopoly's profit.

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Definitions:

Allowance for Doubtful Accounts

A contra-account reduced from accounts receivable on a company's balance sheet that represents the amount of sales that are expected not to be collected.

Accounts Receivable

Debts that customers have towards a business for items or services received but payment is outstanding.

Interest Calculation

The process of determining the interest charge on a loan or financial investment, based on the principal amount, rate, and time.

Maturity Date

The specific date on which the principal amount of a debt instrument, such as a bond or loan, becomes due and payable.