1. The individual demand curve slopes downward because a. the value an individua

Question

1. The individual demand curve slopes downward because
a. the value an individual places on an extra unit of the good decreases.
b. the amount an individual is willing to pay for the additional unit increases.
c. the total value consumers derive from consuming a product increases when they consume
more units.
d. All of the above.

2. The strategy underlying price discrimination is
a. to charge higher prices to customers who have good substitutes available to them.
b. to charge everyone the same price, but limit the quantity they are allowed to buy.
c. to increase total revenue by charging higher prices to those with the most inelastic
demand for the product and lower prices to those with the most elastic demand.
d. to reduce per-unit cost by charging higher prices to those with the most inelastic
demand and lower prices to those with the most elastic demand.

Explanation / Answer

1. b 2. c

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