If a monopoly is price discriminating between two groups, A and B, based on observable customer characteristics, there is a difference in the marginal cost of selling to the two groups, and the elasticity of demand for group A is -1.5 while the elasticity of demand for group B is -2.1, which of the following is true?
A. The markup and price for group A customers will be higher than for group B customers.
B. The markup and price for group B customers will be higher than for group A customers.
C. The markup for group A customers will be higher than for group B customers, but there is not enough information to determine which price will be higher.
D. The price for group A customers will be higher than for group B customers, but there is not enough information to determine which markup will be higher.
C. The markup for group A customers will be higher than for group B customers, but there is not enough information to determine which price will be higher.
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Refer to Figure 22-1. Technological change is illustrated in the per-worker production function in the figure above by a movement from
A) A to B. B) B to A. C) D to C. D) B to C.
When the Federal Reserve float __________, bank reserves __________
A) rises; fall B) rises; rise C) rise; are unchanged D) rise; change unpredictably