Compared to the Monopoly Outcome with a Single Price, Imperfect

question 75

Multiple Choice

Compared to the monopoly outcome with a single price, imperfect price discrimination
(i) sometimes raises total surplus.
(ii) sometimes lowers total surplus.
(iii) always leads to a lower quantity of output.

• A)(i) and (ii) only
• B)(ii) and (iii) only
• C)(i) and (iii) only
• D)(i), (ii), and (iii)

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Definitions:

Drive-Reduction Theory

A psychological concept suggesting that motivation arises from biological needs that push organisms to seek homeostasis through reducing drives stemming from those needs.

Tension

The physical or emotional strain caused by conflicting or demanding circumstances.

Stability

The condition of being resistant to change or variation, often used in psychological contexts to refer to emotional or mental consistency.

Primary Drives

Basic, instinctual drives that motivate behaviors necessary for survival, such as hunger, thirst, and avoidance of pain.