If a Firm Wishes to Engage in Price Discrimination,which of the Following

question 41

Multiple Choice

If a firm wishes to engage in price discrimination,which of the following conditions must be met?

• A)The demand curve must be horizontal.
• B)It must be possible to prevent resale of the good from low-paying to high-paying customers.
• C)The supply curve must be horizontal.
• D)Many identical firms in the market must each have a small share of total industry output.
• E)Price must be less than marginal cost.

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Definitions:

Weighted-Average Method

The weighted-average method calculates the cost of goods sold and ending inventory value, considering the average cost of all inventory items based on weight.

Equivalent Units

A concept used in cost accounting to standardize units of production, making them comparable despite being in different stages of completion.

Fabricating Department

A section within a manufacturing company where raw materials are assembled or processed into finished products.

Weighted-Average Method

An inventory costing method that calculates the cost of goods sold and ending inventory value based on the average cost of all items available for sale during the period.