chapter 12 - a. b. c. d.

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Price discrimination occurs when a firm sells:     a. different products at the same price to different customers.   b. different products at different prices to different customers.   c. the same product at the same price to different customers.   d. the same product at different prices to different customers. 1 out of 1 Correct. Price discrimination is selling the same product at different prices to difference customers.   Price discrimination is:     a. illegal in most states.   b. only done by firms that are monopolies.   c. easy to find if you look for it.   d. requires firms to separate markets by geography. 1 out of 1 Correct: Price discrimination is common in many industries   If the demand curves of two separate markets are identical, a firm will find it most profitable to charge  __________ prices in the two markets because the marginal revenue curves are ________ in the two  markets.     a. different; the same   b. different; different   c. the same; the same   d. the same; different 1 out of 1 Correct: If the demand curves are the same, the marginal revenue curves must be the same, therefore it  would follow that the profit maximizing price in both markets would be the same.   If a firm is able to divide their customers into two groups, the firm can maximize profits by setting  _________ equal to marginal cost in each market.     a. marginal revenue   b. demand   c. price   d. average cost
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1 out of 1 Correct: The firm will treat each market separately and maximize profits by setting marginal revenue equal  to marginal cost in each market.   If a firm segments the market and practices price discrimination, which of the following statements is  correct about the new prices relative to a single price monopoly:     a. the new prices are both higher.   b. the new prices are both lower.   c. one of the new prices is higher and one of the new prices is lower.   d. there is not enough information to answer the question. 1 out of 1 Correct: The price in the market with the less elastic demand will be higher and other market will be  lower.
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