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5. A firm that practices price discrimination based on the price elasticity of demand will charge: a. a higher price to buyers whose demand is
5. A firm that practices price discrimination based on the price elasticity of demand will charge:
a. a higher price to buyers whose demand is relatively[ (circle one) elastic or inelastic]
b. a lower price to buyers whose demand is relatively [ (circle one) elastic or inelastic ] and
6. a. T F In general profit-maximizing firms price discriminate or give discounts to senior citizens out of concern for the economic hardship they may face.
b. T F An insurance company offering discounts to safe drivers is an example of price
discrimination.
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