Suppose a Producer Is Able to Separate Customers into Two

question 63

Multiple Choice

Suppose a producer is able to separate customers into two groups,one having an inelastic demand and the other having an elastic demand.If the producer's objective is to increase total revenue,she should

• A) increase the price charged to customers with the elastic demand and decrease the price charged to customers with the inelastic demand.
• B) decrease the price charged to customers with the elastic demand and increase the price charged to customers with the inelastic demand.
• C) decrease the price to both groups of customers.
• D) increase the price for both groups of customers.

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Definitions:

Sphenoid Bone

A complex, butterfly-shaped bone at the base of the skull, key in forming the base of the cranial cavity and the sides of the skull.

Pituitary Gland

A small, pea-sized gland located at the base of the brain responsible for regulating critical body functions and hormones.

Bent Spine

A condition characterized by a significant curvature or deformity of the spine, such as in scoliosis or kyphosis.

Cartilaginous Tip

The end part of a structure, such as a bone or joint, that is made of cartilage, a flexible connective tissue.