If a Firm Knew Every Consumer's Willingness to Pay and Could

question 105

Multiple Choice

If a firm knew every consumer's willingness to pay and could prevent arbitrage, it could charge every consumer a different price.This practice is known as

• A)first-degree exploitation, or perfect price discrimination.
• B)maximization of producer surplus, or perfect price discrimination.
• C)first-degree price discrimination, or perfect price discrimination.
• D)first-degree transfer of consumer surplus, or perfect price discrimination.

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Definitions:

Stirrup

A tiny bone in the middle ear that plays a critical role in the process of hearing by transmitting sound vibrations to the inner ear.

Middle Ear

The part of the ear located between the eardrum and the inner ear, containing three small bones that transmit sound vibrations.

Cones

Specialized photoreceptor cells in the retina of the eye responsible for color vision and functioning best in relatively bright light.

Vision

The capability of the eyes and brain to interpret electromagnetic energy (light) into images, enabling sight.