Author Question: A mail-order clothing company offers a discount if customers purchase two shirts instead of only ... (Read 106 times)

jasdeep_brar

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A mail-order clothing company offers a discount if customers purchase two shirts instead of only one. This is necessarily an example of quantity discrimination.
 
  Indicate whether the statement is true or false

Question 2

A mixed strategy may
 
  A) be part of a Nash equilibrium.
  B) be a set of probabilities of selecting each possible action.
  C) lead identical firms to choose different actions.
  D) All of the above.



af

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Answer to Question 1

False. The shipping cost per item is less for two shirts than for one. This cost difference may explain the discount.

Answer to Question 2

D



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