Questiona) You might have experienced differential prices in your daily life. Please share your experienceand explain why the service providers were able to charge you different prices at different places?b) How did the service provider, you benefited from, make the differential prices work?c) Do you think Monopoly increases general welfare?

Since the first two questions are subjective, we will answer the third question for you. A monopoly…

Answered: Do you think Monopoly increases general…

Business

Economics

Do you think Monopoly increases general welfare?

Economics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506725

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter23: Price-searcher Markets With Low Entry Barriers

Section: Chapter Questions

Problem 11CQ

See similar textbooks

Similar questions

Students were able to obtain these tickets, make fictitious reservations, cancel the reservations at the last minute, and secure a seat on the flight at a discounted price. Answer the following questions. 1. Is this a form of price discrimination? Why? Include in your analysis differing levels of elasticity, if relevant, and any other feature 2. Why would an airline use this practice? Provide a dollar and cents example. 3. The airlines caught up with this scheme, what principal of price discrimination did the students violate so as to end it?
So, why do firms practice third-degree price discrimination? a) firms get pressure to offer lower prices to some consumer types- like children or senior citizens. b) Firms can earn greater profits practicing third-degree price discrimination compared to charging a single price per ticket. I need help figuring out if the answer is a or b.
Suppose you can separate consumers into two groups: Group 1 has a price elasticity of demand = -4 and group 2 has a price elasticity of demand of -6. If you could conduct third degree price discrimination, which group would you charge a higher price to? Why? Suppose the the profit maximizing price for group 2 is $36. What price should I charge group 1? Show all your work.
Price Discrimination à what does it mean? Who does this practice? How and why? Give suitable examples in this regard
QUESTION4 -As a Manager in charge of pricing in an organisation, you have a deep understanding of how elasticity of demand affects your business. Give atleast 3 factors that affect elasticity of demand. -Explain two(2) benefits of Price Discrimination. -Patel and John are arguing on whether Monopolistic Competition and Monopoly are the same. Using a table present 5 similarities of the two market structures
Q. STIHL, Inc., manufactures gasoline-powered chain saws for professional, commercial, farm, and consumer markets. To “better serve” their customers, STIHL offers its chain saws in four different quality lines and associated price ranges: occasional use, midrange, professional, and arborist. Under what circumstances could offering multiple qualities of a product be price discrimination? What form of price discrimination might this represent—first-, second-, or third-degree price discrimination? Explain why this practice could increase profit at STIHL.
Price Discrimination: SouthSide Salon is a local bar and nightspot in Mankato. On weekends, it requires a $5 cover charge to defray the costs of the live musical acts. This has worked wonderfully, as it generates capacity crowds and a long line of people waiting to enter. Questions: Explain the economic significance of charging a $5 cover for the live musical acts (what kind of price discrimination is this?). Provide two (2) price discrimination schemes of 2nd and 3rd degrees that the bar could implement to increase profitability. Make sure to explain if identification and arbitrage are necessary conditions and why.
Q2. a) define the income elasticity of demand? b) what is the normal and an inferior good? c) define the cross-price elasticity of demand? d) Compare and contrast monopoly and perfect competition market structures in the Long-run.
not copy paste Explain and discuss how monopoly pricing targets to capture consumer surplus. In your answer cover the followings: a) What kind of consumer behavior is second-degree price discrimination based on? Support your answer with relevant examples
Describe the concept of price elasticity? Why it is for a monopoly less profitable to act inmarkets with high price elasticity?
explain why a monopoly would want to price discriminate explain the (potential) effects of price discrimination on market efficiency.