Peak-load pricing suggests that some prices are a function of
A) extensions.
B) time.
C) costs.
D) constant elasticities.
QUESTION 2If a firm is unable to distinguish different customer groups
A) it will not use product differentiation.
B) it will be unable to maximize profits.
C) it will find the quantity to product indeterminate.
D) it might use a product line extension.
QUESTION 3In a product line extension
A) a constant price elasticity of demand is assumed.
B) a firm introduces different products and lets buyers self-select themselves into different groups.
C) is able to identify different markets at very low costs.
D) demand is assumed to be elastic
QUESTION 4To practice second-degree price discrimination
A) different markets must be able to communicate with each other.
B) different markets must have the same number of customers.
C) similar markets must have similar elasticities.
D) different markets must have different elasticities.
QUESTION 5If each customer is sold a product at a different price, then the firm is practicing
A) perfect price discrimination.
B) second-degree price discrimination.
C) third-degree price discrimination.
D) product differentiation.
QUESTION 6In order to earn an economic profit, a firm needs to charge a price in excess of
A) accounting average cost.
B) normal average costs.
C) economic average cost.
D) long-run fixed costs.
QUESTION 7By personalizing price, firms are attempting to
A) minimize costs.
B) price discriminate.
C) standardize the pricing process.
D) none of these choices.
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