Answered: Second degree price discrimination is…

Second degree price discrimination is the same as group pricing. none of the other answers are correct. personal discrimination. menu pricing. personalized pricing. menu costs.

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter14: Indirect Price Discrimination

Section: Chapter Questions

Problem 10MC

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Concept explainers

Price Discrimination

Price discrimination or differential pricing is based on the principle that the seller will charge the buyer a price based on the buyer’s ability and willingness to pay for the product rather than applying uniform pricing for all.

Question

Second degree price discrimination is the same as
group pricing.
none of the other answers are correct.
personal discrimination.
menu pricing.
personalized pricing.
menu costs.

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Select the correct statements. Note. Multiple correct, multiple selections A. With first-degree price discrimination, the marginal revenue curve is below the demand curve, with the absolute value of the slope equal to twice the slope of demand B. With first-degree price discrimination, the marginal revenue curve is the same as the demand curve. C. With third degree price discrimination, the firm identifies different consumer groups, or segments in a market and then charges a price for each segment by setting the price equal to marginal cost D. With a block tariff (with two blocks), the consumer pays one price for units consumed in the first block of output (up to a given quantity) and a different (usually lower price for any additional units E. Mixed bunding is sometimes the most profitabile strategy for a firm because consumers prefer to spend on binges and make multiple purchases at the same time
Decide whether the statement is True, False, or Uncertain, and give a brief explanation. A car rental company has been issuing coupons on the internet. Since the coupons are accessible to the general public, they cannot be a form of price discrimination.
Safeway sells water for $2 a bottle or $18 for a box of 12 bottles. This is an example of third degree price discrimination. Group of answer choices True False
Perfect price discrimination consists of Group of answer choices charging each customer their reservation price. charging each customer based on the marginal cost. basing price on the highest marginal cost the customer is willing to pay. charging each customer the lowest price they are willing to pay.
When does price discrimination take place? Group of answer choices A monopoly enters a market with high-income customers. A business conceals its pricing policies. A business charges different prices to different customers based on their willingness to pay.
If a firm engages in perfect price discrimination, it charges a. different prices to customers based on how many units of output they buy b. each customer the highest price the customer is willing to pay c. different prices to customers based on how old they are d. each customer the average cost of the product e. each customer the lowest price the customer is willing to pay
In third-degree price discrimination, consumer groups with the largest price elasticity of demand will pay the lowest price compared to the consumer groups with smaller price elasticities. True or False.
Which of the following if true would make it harder for a firm to practice price discrimination? Group of answer choices There is a market where buyers can resell what they buy. The firm knows about differences in demand across recognizable groups. The firm has market power.
Discuss to what extent you agree with the following statements Price discrimination is beneficial for the society in general but it is difficult to practice in real world
Which of the following is necessary for a firm to practice price discrimination? Group of answer choices a. The firm is a member of a cartel. b. The demand curve for the product is perfectly inelastic. c. The firm can prevent resale of its goods. d. The government strictly enforces antitrust laws. e. The demand curve for the product is perfectly elastic.
Which of the following conditions must occur for the direct price discrimination to be successful? Group of answer choices The seller must be able to offer a different price for each customer. The seller must be able to distinguish between high and low value customers. The seller must prevent a resale of products between customers. All of the above. None of the above.
What is Price Discrimination? Charging individual customers, a different price for the same product Offering volume discounts Charging customer groups, a different price for the same product All of the above