At a fast food restaurant, a large drink is twice as big as a small drink, but the restaurant charges 79¢ for the small drink and only 99¢ for the large drink. This situation is probably not a case of price discrimination because
a. the restaurant cannot easily prevent resale.
b. people who buy large drinks order more food than people who buy small drinks.
c. the cost of serving a large drink is not twice the cost of serving a small drink.
d. the fast food restaurant has no monopoly power.
c. the cost of serving a large drink is not twice the cost of serving a small drink.
You might also like to view...
Keynesian monetary theory:
a) is the same as the classical theory in all essential elements. b) states that changes in the money supply have no impact on GDP in either the short or long run. c) states that an increase in the money supply leads to lower interest rates, which stimulates investment and aggregate demand. d) states that an increase in the money supply will lower interest rates and thereby shift the long-run aggregate supply curve to the right.
The vertical distance of the shift in supply from a specific tax of t amount on producers will
A) equal t. B) be less than t. C) depend on the elasticity of supply. D) depend on the incidence of the tax.