Which of the Following Is True of a Price Discriminating

question 49

Multiple Choice

Which of the following is true of a price discriminating monopolist employing a two-part tariff on consumers having different demands?

• A)They earn less profit than the non-price discriminating monopolists.
• B)They supply an output which is higher than the non-price discriminating monopoly output.
• C)They set a price that is higher than the non- price discriminating monopoly price.
• D)They set an entry fee which is more than the total consumer surplus.

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Definitions:

Management Decisions

The process by which management selects among available options to guide the operations and set the strategic direction of an organization.

Full Capacity

The maximum level of output that a company can sustain to generate products or services under normal operating conditions.

Special Price

A temporary discounted offer or a negotiated price lower than the usual list price, often used to stimulate demand or reward customers.

Variable Costs

Costs that vary directly with the level of production or the volume of services provided.