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Principles of Microeconomics

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Once again, more review questions stumping me. Any assistance would be great!

Firms who are attempting to engage in price discrimination will offer customers with a ______demand a higher price and customers with a (an) _______ demand a lower price.

a. lower; higher.

b. normal; inferior.

c. less elastic; more elastic.

d. more elastic; less elastic.

When a monopolist charges a low price to drive out competition, then charges a high price, the monopolist is engaging in:

a. a trust agreement.

b. a merger.

c. duopoly pricing.

d. predatory pricing

Which of the following is most true about advertising?

a. Advertising has costs but no benefits.

b. There is no role for advertising for a firm in a perfectly competitive market.

c. Firms should advertise at a level where marginal benefit exceeds marginal cost.

d. Consumers are equally sensitive to advertising about all products

When economies of scale are present, but are not sufficiently large to generate a natural monopoly, the expected market structure is:

a. monopoly.

b. monopolistic competition.

c. perfect competition.

d. oligopoly

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Firms who are attempting to engage in price discrimination will offer customers with a ______demand a higher price and customers with a (an) _______ demand a lower ...

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