You Currently Sell the Same Product to Both Students and Faculty

question 6

Multiple Choice

You currently sell the same product to both students and faculty members, and are able to prevent transfer from one group to the other. Your current prices, quantities sold, and the absolute values of the slopes of the demand curves are as follows: If your marginal cost is $1 and you are interested in maximizing your revenues, how would you adjust your prices?

• A) Increase prices for both groups.
• B) Decrease prices for both groups.
• C) Increase student price and decrease faculty price.
• D) Decrease student price and increase faculty price.

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Definitions:

Individual Characteristics

Traits, attributes, or qualities that define or differentiate one person from another.

Wage Discrimination

The practice of paying different wages to employees who perform similar work, based on non-performance-related factors such as race, gender, religion, or national origin.

Discrimination Coefficient

A measure used in various disciplines to quantify the degree of discrimination or bias present in a particular process or decision-making system.

Nonwhite Worker

A term that categorizes employees based on racial or ethnic identities other than white.