Multiple Choice
Suppose a firm produces identical goods for two separate markets and practices third-degree price discrimination. In the first market the firm charges $30 per unit, and it charges $22 per unit in the second market. Which of the following represents the ratio of price elasticities of demand in the two markets?
A) E2 = (21/29) E1
B) E2 = (29/21) E1
C) E2 = E1
D) E2 = (22/30) E1
E) none of these
Correct Answer:
Verified
Correct Answer:
Verified
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