What are the different types of price discrimination?
What will be an ideal response?
There are three different types of price discrimination. They are:
a) First-degree price discrimination: Consumers are charged the maximum price they are willing to pay.
b) Second-degree price discrimination: Consumers are charged different prices according to the characteristics of their purchases.
c) Third-degree price discrimination: Different groups of consumers are charged different prices for the same good or service.
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An optimal corrective tax _____
a. falls as quantity produced increases b. is above the marginal external product c. is a lump sum tax d. helps to increase demand for the taxed product
The federal funds rate is the interest rate:
a. On U.S. interbank loans. b. The Federal Reserve changes banks that borrow from it. c. The World Bank charges to central banks. d. Central banks charge individuals. e. U.S. financial institutions pay to their best (i.e., largest) depositors.