If a firm is unable to distinguish different customer groups
A) it will not use product differentiation.
B) it will be unable to maximize profits.
C) it will find the quantity to product indeterminate.
D) it might use a product line extension.
D
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Along an upward-sloping labor supply curve, as the wage rate increases, the opportunity cost of leisure ________, causing individuals to supply a ________ quantity of labor
A) decreases; greater B) increases; greater C) remains constant, constant D) increases; lower
Adverse selection is a problem associated with equity and debt contracts arising from
A) the lender's relative lack of information about the borrower's potential returns and risks of his investment activities. B) the lender's inability to legally require sufficient collateral to cover a 100% loss if the borrower defaults. C) the borrower's lack of incentive to seek a loan for highly risky investments. D) the lender's inability to restrict the borrower from changing his behavior once given a loan.