One of the Necessary Conditions for Price Discrimination to Occur

question 127

Multiple Choice

One of the necessary conditions for price discrimination to occur is that:

• A) buyers in different markets have different elasticities of demand.
• B) the demand curve is upward sloping.
• C) buyers must be allowed to resell the good at a higher price elsewhere.
• D) all of these are necessary for price discrimination to occur.

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Definitions:

Implied Warranty

A legal assumption in commerce that goods are reasonably fit for the general purpose for which they are sold, even if not expressly stated.

Operation of Law

A way in which rights or liabilities are automatically transferred or changed due to existing legal rules, rather than the action of the parties.

Implied Warranty

An unwritten and unspoken guarantee that a product or service will meet a minimum level of quality and will perform as expected, even though it is not explicitly stated in a contract.

Merchantability

A warranty that goods sold will meet a minimum level of quality and will be fit for the purpose for which they are sold.