Question

In: Economics

Complete the following table by indicating whether each of the scenarios describes the concept of tying, resale price maintenance, or predatory pricing.

10. Questionable business practices according to antitrust agencies

Complete the following table by indicating whether each of the scenarios describes the concept of tying, resale price maintenance, or predatory pricing.

 

 Scenario

 TalkieTime is a firm that produces smartphones. Suppose TalkieTime sells its smartphones to retail stores for $209 each and requires those retailers to charge customers at least $229 for each smartphone.

 Heat-Em-Up is the only firm producing grills. It costs $410 to produce a grill, and Heat-Em-Up sells each grill for $1,000. After Well Done, a new firm with the same costs as Heat-Em-Up, enters the market for grills, Heat-Em-Up starts selling its grills for a price of $330.

 Book Bound sells a wide variety of books to retail bookstores. Book Bound recently published two new books: a popular mystery novel and a much less popular history book. Book Bound requires bookstores to buy 15 copies of the history book for every 140 copies of the mystery novel ordered.

 

True or False: The only reason for Talkie Time to require retailers to sell smartphones at a certain price is to reduce competition and extend its market power to the retail market. Therefore, this practice is always economically inefficient. 

Solutions

Expert Solution

A predatory pricing is the pricing strategy where in the firm charges a price less than its marginal cost. This is done to wipe out competition.

Under a resale price maintenance, the manufaturers asks its retailers to maintain a minimum or maximum price.

Under a tying contract, the manufactuer makes it mandatory for its distributors to buy one product along with another.

FALSE- In bundling, two related goods are priced such that the price of bundled goods will be less than price of individual goods

Rahul Sunny answered 2 years ago
Next > < Previous

Related Solutions

6. Examples of price discrimination Complete the following table by indicating whether or not each scenario...
6. Examples of price discrimination Complete the following table by indicating whether or not each scenario is an example of price discrimination. Hint: To determine whether a scenario is an example of price discrimination, think about whether the market can be segmented into two groups that pay different prices for the same good. Scenario Price Discrimination Yes No Most restaurants will supply a free dessert if it is the customer's birthday. Assume that this is not specifically advertised by restaurants....
Complete the following table by indicating at each price whether there is a shortage or surplus in the market, the amount of that shortage or surplus, and whether this places upward or downward pressure on prices.
 9. Market equilibrium and disequilibrium The following graph shows the monthly demand and supply curves in the market for calendars. Use the graph input tool to help you answer the following questions. Enter an amount into the Price field to see the quantity demanded and quantity supplied at that price. You will not be graded on any changes you make to this graph. The equilibrium price in this market is _______  per calendar, and the equilibrium quantity is _______  calendars bought and sold...
Complete the following table by calculating the missing entries and indicating whether the solution is acidic,...
Complete the following table by calculating the missing entries and indicating whether the solution is acidic, basic or neutral. the pOH for one row is 9.75 and the H+ on the bottom row is 6.17x10^-11. For the row that the pOH is 9.75 you have to find the pH, the H+, OH- and if its an acid or base. For the row that the H+ is 6.17 x 10^-11 you have to find the ph, pOH, OH- and if its...
Complete the following table by indicating whether an event will cause a movement along the demand...
Complete the following table by indicating whether an event will cause a movement along the demand curve for donuts or a shift of the demand curve for donuts all else constant
Complete each of the following as a net ionic equation, indicating whether a precipitate forms. If...
Complete each of the following as a net ionic equation, indicating whether a precipitate forms. If no reaction occurs, so state. Ca2++2Cl−+Pb2++2NO−3→ Al3++3NO−3+K++OH−→ Fe3++3NO−3+Na++OH−→
Q12: Complete the following table by indicating how equilibrium price (P*) and equilibrium quantity (Q*) will...
Q12: Complete the following table by indicating how equilibrium price (P*) and equilibrium quantity (Q*) will change. Use + for increase, – for decrease, 0 for no change, and ? for unknown change. One of the cells has been filled in for you. When there is there is an increase in demand and no change in supply, P* increases and Q* increases.    Increase in supply No change in supply Decrease in supply Increase in demand DP* = DQ* =...
For each of the following scenarios, explain whether the situation describes financial risk or business risk....
For each of the following scenarios, explain whether the situation describes financial risk or business risk. Explain your answers to each scenario using at least one of the references from the background readings: A pharmaceutical company has developed a new cancer treatment drug that has a much higher success rate than other drugs currently in the market. It has the potential to triple the company’s profits. However, the FDA has expressed concern about some side effects, and it is not...
Each of the following scenarios describes a correlation between two variables. State whether the correlation is...
Each of the following scenarios describes a correlation between two variables. State whether the correlation is most likely due to a coincidence, a common underlying cause, or a direct cause. If there is an underlying cause, state what you think it is. If you believe that one variable directly causes the other, suggest possible physical causation. 1. Sales of winter boots are positively correlated with the sale of sidewalk salt. 2. I’ve noticed that the more hours I work each...
Complete each of the columns on the table below, indicating in which section each item would...
Complete each of the columns on the table below, indicating in which section each item would be reported on the statement of cash flows (operating, investing, or financing), the amount that would be reported, and whether the item would create an increase or decrease in cash. For item that affect more than one section of the statement, indicate all affected. Assume the indirect method of reporting cash flows from operating activities. The first item has been completed as an example....
For each of the following scenarios, state whether there is or is not a contract, and...
For each of the following scenarios, state whether there is or is not a contract, and why: 1. Bob and Mary were talking at a bar on Thursday night. Bob wrote the following on coaster and handed it to Mary: “I promise to pay you $1,000 to dance with man at the bar in the Gray Shirt” Mary read the coaster, signed it, and danced with the man in the gray shirt. 2. Mr. Wilson said to 18 year old...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT