You Can Go to Your Nearest Hallmark Card Store and Buy

question 126

Multiple Choice

You can go to your nearest Hallmark card store and buy a birthday greeting card for a friend and pay $4.50, or you can buy a card that's not quite as nice but just as sentimental from the store's new $.99 line of greeting cards.This is an example of

• A)mass customization.
• B)organizational synergy.
• C)one product and multiple market segments.
• D)price discrimination.
• E)a "Tiffany/Wal-Mart" strategy.

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Definitions:

Economic Profits

The surplus generated when total revenues exceed the total costs, including both explicit and implicit costs.

Efficiency

The optimal allocation and use of resources to produce goods and services in the most cost-effective and waste-free manner.

P > MC

Indicates a scenario in price (P) is greater than marginal cost (MC), suggesting that a firm could potentially increase profits by increasing production since each additional unit produced costs less than the price it would sell for.

Monopoly

A market structure in which a single seller controls the entire market for a good or service, with no close substitutes.