Consider Three Pricing Strategies That the Firm Can Pursue

question 217

Multiple Choice

Consider three pricing strategies that the firm can pursue:
A.optimal two-part tariff pricing
B.perfect price discrimination
C.single-price monopoly pricing
Of these three strategies, which is most beneficial to society as a whole?

• A)Both perfect price discrimination and a two-part tariff pricing are equally beneficial in that the marginal benefit of the last unit sold equals the marginal cost of producing that unit.
• B)only perfect price discrimination because this pricing method eliminates deadweight loss
• C)single-price monopoly pricing because consumers enjoy at least some consumer surplus
• D)only two-part tariff pricing because the per-unit portion of the price is set equal to marginal cost

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Definitions:

Capital Balance

The amount of money invested in a company by its owners or shareholders, represented in the equity section of the balance sheet.

Accounting Period

The span of time at the end of which a company's financial performance is measured and reported.

Investments

Assets purchased with the aim of generating income or appreciation, such as stocks, bonds, or real estate.

Withdraw

Withdraw refers to the act of taking out money from a bank account or the removal of assets or resources from use or participation.