Agri-Tech supplies a patented sweetener to various food processors. It has noticed that the value of the sweetener varies dramatically from one buyer to another, depending on the end-use demand. But its experiments with charging higher prices to some buyers have failed because:
A. outsourcing is compromised by contracting costs.
B. of market arbitrage.
C. the cost of production is always the same.
D. price discrimination is illegal.
Answer: B
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Why could diseconomies of scale never occur if production relationships were only technical relationships?
A. Because producers would have a greater variety of methods of production to avoid the diseconomies. B. Because the same technical process could be used over and over again at the same cost. C. Because having technical relationships would mean that managers would not have to choose among production techniques. D. Because technical relationships mean that the marginal cost curve would be flat.
In much of Europe, the legal age to obtain a driver's license is 18. If the legal driving age in the United States was changed to 18, how would this affect the market for new automobiles? The market for automobile insurance?
What will be an ideal response?