When Delta Airlines Raises or Lowers Its Prices on Its

question 105

Multiple Choice

When Delta Airlines raises or lowers its prices on its Atlanta to Chicago route other airlines tend to make the same changes in their pricing.This is an example of _____ pricing.

• A) status quo
• B) target return
• C) market share
• D) predatory
• E) cost-plus

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Definitions:

Rent Ceiling

A government-imposed limit on how high rents can go, aimed at keeping housing affordable.

Economic Profit

The difference between a firm's total revenues and its total costs, including both explicit and implicit costs, representing the additional value created by the firm beyond that required to compensate its resource suppliers.

Shortage

A condition where the demand for a product exceeds its supply in the market.

Ceiling Price

Ceiling price is a legally imposed maximum price on goods or services, above which transactions cannot legally occur, often implemented to prevent price gouging during shortages.