(Figure: Groups a and B I) Suppose a Firm Has

question 42

Multiple Choice

(Figure: Groups A and B I) Suppose a firm has two types of customers but cannot tell which type of buyer the customer is before a purchase is made. If the firm wanted to use quantity discounting, it should charge _____ per unit for any quantity purchased or _____.

• A) $12; $4 per unit for 4 or more units
• B) $12; $7 for 3 or more units, but the pricing scheme would not be incentive-compatible for Type B customers
• C) $7; $4 for 2 or more units, but the pricing scheme would not be incentive-compatible for Type A customers
• D) $8.50; $4 for 3 or more units

---

Definitions:

Principle of Specialization

The organizational principle suggesting that dividing tasks and responsibilities among individuals or groups boosts efficiency and expertise by allowing them to focus on specific facets of their work.

Theory Y

A management concept that assumes employees are self-motivated, seek responsibility, and are creative problem solvers.

Job Autonomy

The extent to which a role allows a worker the autonomy to plan their tasks and decide on the methods to accomplish them.

Democratic Manager

A managerial style characterized by involving employees in decision-making, valuing their input, and making decisions by consensus.