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Title: According to a New York Times article, shoppers from New York City have played a game of "retail ... Post by: tarasen57 on Oct 10, 2019 Question 1. A firm's efforts to increase profit by price discrimination can be undermined by ▸ consumer ignorance. ▸ seller market power. ▸ arbitrage by buyers. ▸ differences in elasticity of demand. Question 2. According to a New York Times article, shoppers from New York City have played a game of "retail arbitrage" by shopping at malls in Northern New Jersey, a state where there is no tax on clothing and shoes. Even after accounting for transactions costs, shoppers could still save money on their clothing and footwear purchases. Source: Ken Belson and Nate Schweber, "Sales Tax Cut in City May Dim Allure of Stores Across Hudson," New York Times, January 18, 2007. Is the term "arbitrage" correctly used here? ▸ No, "arbitrage" does not apply to markets that are not in the same geographic area. ▸ Yes, because shoppers were able to purchase items at lower prices even after deducting their transactions costs. ▸ Yes, arbitrage applies even if no resale takes place; in this case the profits are pocketed by the customers themselves. ▸ No, "arbitrage" means buying at a low price and reselling at a higher price but no resale takes place here. Title: According to a New York Times article, shoppers from New York City have played a game of "retail ... Post by: christinaalex on Oct 10, 2019 Content hidden
Title: According to a New York Times article, shoppers from New York City have played a game of "retail ... Post by: tarasen57 on Oct 10, 2019 Thank you, thank you, thank you!
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