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Sellers may choose not to sell in certain markets because: it is possible to pra

ID: 1140301 • Letter: S

Question

Sellers may choose not to sell in certain markets because:

it is possible to practice price discrimination against customers.

they are able to impose negative externalities on third parties.

an above-average profit potential is projected.

buyers are unable to perceive the high quality of their goods and are, therefore, less willing to pay for them.

a.

it is possible to practice price discrimination against customers.

b.

they are able to impose negative externalities on third parties.

c.

an above-average profit potential is projected.

d.

buyers are unable to perceive the high quality of their goods and are, therefore, less willing to pay for them.

Explanation / Answer

Sellers may choose not to sell in certain markets because buyers are unable to perceive the high quality of their goods and are, therefore, less willing to pay for them. The buyers are apprehensive of the quality of the product and are only ready to pay the price of a lemon to all goods. The sellers therefore may chose not to sell their product.

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