If coffee and cream are complements, an increase in the price of coffee will cause
a. the demand for cream to increase.
b. the demand for cream to fall.
c. the demand for coffee to fall.
d. no change in the demand for cream; only quantity demanded would be affected.
B
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Which of the following is not a condition required for a monopolist to price discriminate?
a. the demand curve facing the firm must be downward-sloping b. the firm must exhibit strong economies of scale c. there must be different groups of buyers with different price elasticities of demand d. the firm must be able to prevent reselling of the product e. the firm must have some market power
The more dangerous of two jobs currently pays $3 more per hour. The jobs are equivalent in all other respects. If labor is migrating from the higher-risk job to the lower-risk job, then
a. the equilibrium compensating wage differential is less than $3 per hour b. the wage rate will drop for the more dangerous job c. the wage rate will rise for the less dangerous job d. the equilibrium compensating wage differential is greater than $3 per hour e. equilibrium is unattainable in the two labor markets