Consider a Monopoly's First-Degree Price Discrimination

question 33

True/False

Consider a monopoly's first-degree price discrimination. With first-degree price discrimination, consumer surplus is small, yet still greater than zero.

---

Definitions:

Machine Hours

A measure of the total time a machine operates, often used as a basis for allocating manufacturing overhead costs in production.

Overapplied Overhead

A situation where the allocated manufacturing overhead cost exceeds the actual manufacturing overhead cost incurred.

Underapplied Overhead

Occurs when the allocated factory overhead costs are less than the actual overhead costs incurred.

Overhead Applied

The process of allocating estimated overhead costs to specific jobs or activities based on a predetermined rate.