Author Question: When a firm uses a form of quantity discrimination that charges large purchasers less it is the high ... (Read 68 times)

formula1 · **on:** Jul 1, 2018

When a firm uses a form of quantity discrimination that charges large purchasers less it is the high quantity purchasers that generate most profit.

Indicate whether the statement is true or false

Question 2

When neither player has a dominant strategy,

A) game theory will not provide information.
B) no Nash-Equilibrium exists.
C) at least one Nash-Equilibrium exists.
D) the game cannot be analyzed.

popopong · **Reply #1 on:** Jul 1, 2018

Answer to Question 1

False. Most profit is generated by the fact that the firm is able to charge a high price to purchasers of low quantities and cut in their consumer surplus.

Answer to Question 2

C