Author Question: Customers are usually more willing to pay more for the first unit of a good they purchase than for ... (Read 43 times)

ghost! · **on:** Jul 1, 2018

Customers are usually more willing to pay more for the first unit of a good they purchase than for the second, third, or subsequent units. This implies that

A) typical consumers are irrational.
B) firms are using non-linear price discrimination.
C) firms are unable to determine their customers' reservation prices.
D) typical consumers have a downward sloping demand curve.

Question 2

The cross-price elasticity of demand for coffee and coffee-cream is likely to be

A) greater than zero.
B) less than zero.
C) zero.
D) infinity.