In: Economics
1. As manager, you have decided that it’s time for some price
discrimination to benefit your firm. There are typically three
different “degrees” of price discrimination to choose from.
Describe each “degree” of price discrimination, and then explain
the specific “degree” you would use that has the greatest
applicability to a range of goods that consumers typically purchase
from your firm.
Again, no hedging your bet. :-) Select only one specific degree. Do
not select more than one degree or combinations of
degrees.
2. Being an intelligent manager of an electric utility company, you
decide to take advantage of what’s called capacity
utilization rates provided by the Federal Reserve to help
you decide if more or less spending is a wise course to take. This
month’s capacity utilization rate applicable to your company is
82%. Based on this information, what will you specifically advise
the company to do in order to either expand or contract capacity?
Explain why.