Which of the Following Is True of Price Discrimination

question 9

Multiple Choice

Which of the following is true of price discrimination?

• A)Customers need to have a unit elastic demand curve for price discrimination to occur.
• B)Price discriminators lack the incentive to reduce their average total cost of production.
• C)Customers can easily resell a good to other customers if there exists price discrimination in the market for the good.
• D)Customers need to differ in their willingness to pay for price discrimination to occur.
• E)Price discriminators profit by charging a uniform price to all customers.

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Definitions:

Labor Efficiency Variance

The difference between the actual hours worked and the standard hours expected, multiplied by the standard labor rate.

June

The sixth month of the year in the Gregorian calendar.

Variable Overhead Efficiency Variance

The difference between the actual variable overheads incurred and the standard variable overheads expected for the actual production, due to efficiency.

February

The second month of the year in the Gregorian calendar, typically consisting of 28 days, or 29 in leap years.