With Peak-Load Pricing, a Firm

question 98

Multiple Choice

With peak-load pricing, a firm

• A)charges more for a good during periods of high demand.
• B)charges more for a hotel room the higher up the mountain it is.
• C)charges less for a good during periods of high demand, because of regulatory reasons.
• D)is generally used during January and February.

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Definitions:

Utility Function

An economic model representing how a consumer ranks different bundles of goods based on the level of satisfaction or utility they provide.

Demand

The quantity of a good or service that consumers are willing and able to purchase at various prices during a given period.

Income

The amount of money received by an individual or group over a certain period, often derived from work, investments, or business activities.

Utility Function

A mathematical formula that represents a consumer's preference ranking for various bundles of goods.