A local restaurant sells strawberry pie for $3.00 per slice. However, if you order the prime rib dinner, you can get a slice of pie for only a dollar. This is an example of
A) bundling.
B) second-degree price discrimination.
C) a two-part tariff.
D) tying.
E) none of the above
A
You might also like to view...
Consider a monopolistically competitive firm that is earning profits in the short run. Which of the following changes will this firm experience in the long run? a. The demand for the good produced by the firm will increase
b. The number of competitors faced by the firm will decrease. c. The market price of the good sold by the firm will decrease. d. The marginal cost of production incurred by the firm will reduce to zero.
Suppose two economic models give the same predictions --- but one is simplistic and unrealistic in its assumptions while the other is rich in detail and resembles the real world more closely. If the sole goal of the economist is to predict, then the economist should use the simple and unrealistic model.
Answer the following statement true (T) or false (F)