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Which of the Following Statements Is True

Question 211

Multiple Choice
Which of the following statements is true?
A)Consumer surplus under perfect price discrimination is greater than under single-price monopoly pricing.
B)Consumer surplus under an optimal two-part tariff is greater than that under single-price monopoly pricing.
C)Although consumers reap some consumer surplus under a single-price monopoly, society is better off with optimal two-part tariff pricing.
D)Of the three pricing schedules, single-price monopoly, an optimal two-part tariff, and perfect price discrimination, profit is highest under single-price monopoly pricing.

Which of the following statements is true?


A) Consumer surplus under perfect price discrimination is greater than under single-price monopoly pricing.
B) Consumer surplus under an optimal two-part tariff is greater than that under single-price monopoly pricing.
C) Although consumers reap some consumer surplus under a single-price monopoly, society is better off with optimal two-part tariff pricing.
D) Of the three pricing schedules, single-price monopoly, an optimal two-part tariff, and perfect price discrimination, profit is highest under single-price monopoly pricing.

Correct Answer:

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