How Is It Logically Possible for a Monopolist to Get

question 20

Multiple Choice

How is it logically possible for a monopolist to get different consumers to purchase different bundles on a menu (such as different sizes of coffee cups) ,and thereby achieve a form of price discrimination,even if the firm cannot observe the consumers' valuations directly?

• A)Different types of consumers have different tradeoffs between money and amounts of the good.
• B)The monopolist can use a market-separation strategy.
• C)Social norms are powerful deterrents to lying about one's type.
• D)This is impossible: if one bundle is preferred by one type,logically it will be preferred by all.

Recognize how changes in consumer tastes affect market demand.

Identify the effects of price changes on quantity demanded.

Comprehend the effect of external factors on shifts in demand curves.

Understand the concept of movement along versus shifts in the demand curve.