Which of the Following Is an Advantage of Peak-Load Pricing

question 43

Multiple Choice

Which of the following is an advantage of peak-load pricing?

• A)It allows a firm to reduce its total cost by reallocating its production.
• B)It allows a firm to capture the entire consumer surplus.
• C)It allows a firm to clearly identify each consumer's willingness to pay.
• D)It reduces monopoly profits and increases consumer surplus.

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Definitions:

Stockholders' Claims

The rights of shareholders to a company's assets, often in the context of liquidation or dividend distributions.

Dividend Yield

A financial gauge showing the comparison between a company's annual dividend payments and its share price.

Cash Dividends

Payments made by a company to its shareholders out of its profits or reserves.

Market Price

The current price at which an asset or service can be bought or sold in the market.