2..Price discrimination requires the ability to distinguish customers who are the most price- sensitive and the ability to prevent arbitrage (resale of your products by customers who buy at low prices). What attributes of healthcare products make these tasks easy to do?

3..Can you think of a healthcare firm that does not price discriminate (i.e., charge different customers different amounts for the same product)?

Based on the information about direct and indirect price discrimination in the Indirect Price Discrimination video, describe your opinion of direct and indirect price discrimination. How do these strategies affect consumers? Do these strategies violate the intent of antitrust laws described in Chapter 13, or do you think they are ethically defensible practices for businesses? Explain your rationale. What factors would have to change to make you change your opinion?

I am not sure why my question was flagged by an expert. The Indirect Price Discrimination video is posted on YouTube. This is not spam, sales, or a trick--that just happens to be where the professor linked us to the video.

Video: https://www.youtube.com/watch?v=FXAja1UdINQ

Q1: The following table shows average income of buyers, the price of good G, the price of good H, the quantity demanded (Q^D) of good G and the quantity demanded (Q^D) of good H for 5 periods. Use the information in the table to answer the following questions. Do not round your answers early because your final results will be less accurate.

a) What does the income elasticity of demand for good H equal (to 3 decimal places)? Show clearly how you arrived at your answer. If Fulton has to figure out how you arrived at your answer, marks will be deducted. 3 marks.

b) What does the cross-price elasticity of demand for good G equal (to 3 decimal places)? Show clearly how you arrived at your answer. If Fulton has to figure out how you arrived at your answer, marks will be deducted. 3 marks.

1. Monopoly price compared to the price of a competitive firm

2. Efficiency of resource allocation

3. Monopoly and its impact on large-scale production and unit cost of production

Use the Black-Scholes model to price a call with the following characteristics:

            Stock price      =$28

            Strike price      =$40

            Time to expiration       =6 months

            Stock price variance    =0.65

            Risk-free interest rate =0.06

What does put-call parity imply the price of the corresponding put will be?

Assume that an effective government-imposed price on a particular good. The price is set below equilibrium. Now, the imposed price is removed.

True, False, or Uncertain: Consumer spending on the good will increase only if demand is inelastic. Explain your answer.

1. The government is currently considering setting a maximum price (price ceiling) for basic goods to ensure that people can get access to these goods at this current time. Fully explain your answer and also use a single diagram to demonstrate the likely outcomes of this policy if the maximum price is set:

1. Below the current free market price                                              

2. Above the current free market price

3. At the current free market price      

2. The Australian government has implemented a number of microeconomic reforms over the past 40 years including deregulation of banking. Do you think banking deregulation has been beneficial or not? Explain your answer. Describe what you think may be the difficulties with microeconomic reform in Australia and highlight an area that you think currently requires microeconomic reform. Justify your answer.

Under competitive competitions, why can a market price not be higher or lower than the price established by the free market forces of demand and supply?

The stock price of Comet Inc. is currently $30. The stock price a year from now will be either $50 or $10 with equal probabilities. The interest rate at which investors can borrow is 5%. Using the binomial option pricing model (OPM), the value of a call option with an exercise price of $40 and an expiration date one year from now should be worth what?

A. Identify two (2) functions of price in the market economy.
B. Explain how price is determined in the market economy.
C. What are the possible results if the government interferes with the price level that the free market has determined? Explain how those results could occur and illustrate with an appropriate supply and demand graph.