Which of the Following Conditions Will Allow a fiRm to Undertake

question 59

Multiple Choice

Which of the following conditions will allow a firm to undertake price discrimination successfully?

• A) The good or service that is being sold must be a new or innovative product.
• B) The firm must face a perfectly elastic demand curve.
• C) The firm must be able to identify consumers willing to pay different prices.
• D) Customers must be able to resell the good or service.

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Definitions:

Investment Choices

The act of deciding where to put money to work in the financial or capital markets with the expectation of receiving a return.

Warrant

A warrant gives the holder the right, but not the obligation, to buy or sell a company's stock at a specific price before a certain date, often issued as part of a new stock or bond issue.

Asset Securitizations

The financial process of pooling various types of debt instruments (e.g., loans, bonds) and selling them as consolidated financial securities to investors.

Credit Derivatives

Financial instruments that allow parties to manage exposure to credit risk, through vehicles such as credit default swaps (CDS).